FTC — Audit Report / Information 2020

Nov 13, 2020

FOXCONN TECHNOLOGY CO., LTD.

PARENT COMPANY ONLY FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS’

REPORT

DECEMBER 31, 2020 AND 2019

(STOCK CODE: 2354)

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For the convenience of readers and for information purpose only, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. In the event of any discrepancy between the English version and the original Chinese version or any differences in the interpretation of the two versions, the Chinese-language auditors’ report and financial statements shall prevail.

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INDEPENDENT AUDITORS’ REPORT TRANSLATED FROM CHINESE

Financial Review No. 20004722 (2021)

To the Board of Directors and Stockholders of Foxconn Technology Co., Ltd.

Opinion

We have audited the accompanying parent company only balance sheets of Foxconn Technology Co., Ltd. (the “Company”) as of December 31, 2020 and 2019, and the related parent company only statements of comprehensive income, of changes in equity and of cash flows for the years then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying parent company only financial statements present fairly, in all material respects, the financial position of Foxconn Technology Co., Ltd. as of December 31, 2020 and 2019, and its financial performance and its cash flows for the years then ended in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”.

Basis for opinion

We conducted our audit of the parent company only financial statements as of and for the year ended December 31, 2020 in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants and generally accepted auditing standards in the Republic of China; and in accordance with the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountants, Rule No. Financial-Supervisory-SecuritiesAuditing-1090360805 issued by the Financial Supervisory Commission on February 25, 2020 and generally accepted auditing standards in the Republic of China for our audit of the parent company only financial statements as of and for the year ended December 31, 2019. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the parent company only financial statements section of our report. We are independent of the Group in accordance with the Norm of Professional Ethics for Certified Public Accountants of the Republic of China, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

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Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Company’s 2020 parent company only financial statements. These matters were addressed in the context of our audit of the parent company only financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

Key audit matters for the Company’s 2020 parent company only financial statements are stated as follows:

Revenue Cutoff

Description

Refer to Note 4(27) for accounting policy on revenue recognition and Note 6(19) for details of revenues. The Company has three revenue types, including (1) direct shipment from the factory, (2) FOB destination, and (3) hub. For FOB destination and hub, revenue is recognized when goods are shipped to destination or picked up by customers (when control of the products is transferred). The supporting documents for revenue recognition include receipts from customers (FOB destination), reports or other information provided by hub custodians and inventory movement record of hub. As the hubs are located around the world with numerous custodians, the frequency and contents of statements provided by custodians vary, and the process of revenue recognition involves numerous manual procedures, these factors may potentially result in inaccurate timing of sales revenue recognition and discrepancy between the physical inventory quantities in the hubs and the quantities as reflected in accounting records.

Since there are numerous daily revenue transactions from hubs and from FOB destination and the transaction amounts prior to and after the balance sheet date are significant to the financial statements, revenue cutoff has been identified as a key audit matter.

How our audit addressed the matter

We performed the following audit procedures in respect of the above key audit matter:

1. Evaluated and tested the Company’s internal controls over revenue recognition.

2. Tested sales transactions that took place shortly before and after the balance sheet date by verifying the customers’ receipt notes, supporting documents provided by hub custodian, and inventory movement records, and ascertained whether cost of goods sold was recognized in the correct reporting period.

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1. Confirmed physical inventory quantities held by distribution warehouses and agreed to accounting records. Assessed the reasonableness of reconciling items identified through confirmation or physical inventory, if any and inspected related supporting documents and rationale.

– The Company and Investments accounted for under equity method/subsidiaries Provision for inventory valuation losses

Description

Refer to Note 4(13) for accounting policies on inventory valuation, Note 4(14) for accounting policies on investments accounted for under equity method/subsidiaries and associates, Note 5 for uncertainty of accounting estimates and assumptions in relation to inventory valuation losses, and Notes 6(6) and 6(7) for details of inventories and investments accounted for under equity method.

The Company is primarily engaged in the sales of 3C electronic products manufactured by its subsidiaries. Due to rapid technological innovations, short electronic product life cycles and fluctuations in market prices, there is a higher risk of inventory losses arising from market value decline or obsolescence. The Company and its subsidiaries recognize inventories at the lower of cost and net realizable value which is determined based on historical data of inventory closeout. Inventory valuation losses are provided against inventory aged over a certain time period and individually identified as obsolete or damaged. Provision for inventory valuation losses is recognized under “inventory” and “investments accounted for under equity method – subsidiaries” in the parent company only financial statements.

As the amounts of the Company and its subsidiaries’ inventory are material, types of inventories vary, the identification of obsolete or damaged inventories and determination of net realizable value are subject to management and audit judgement, we considered the provision for inventory valuation losses as a key audit matter.

How our audit addressed the matter

We performed the following audit procedures in respect of the above key audit matter:

1. Ensured consistent application of accounting policies on provision for inventory valuation losses and ascertained compliance with respective accounting guidance.

2. Validated the appropriateness of system logic of inventory aging report utilized by management in assessing inventory valuation losses and sampled and tested transactions for proper categorization in inventory aging report.

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1. Assessed the reasonableness of inventory valuation losses through discussion with management as to the determination of net realizable value of obsolete or damaged inventories and validated related supporting documents.

Responsibilities of management and those charged with governance for the parent company only financial statements

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of parent company only financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the parent company only financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including the Audit Committee, are responsible for overseeing the Company’s financial reporting process.

Auditors’ responsibilities for the audit of the parent company only financial statements

Our objectives are to obtain reasonable assurance about whether the parent company only financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the generally accepted auditing standards in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these parent company only financial statements.

As part of an audit in accordance with the generally accepted auditing standards in the Republic of China, we exercise professional judgment and maintain professional skepticism throughout the audit.

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We also:

1. Identify and assess the risks of material misstatement of the parent company only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal controls.

3. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management

4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the Company to cease to continue as a going concern.

5. Evaluate the overall presentation, structure and content of the parent company only financial statements, including the disclosures, and whether the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

6. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the parent company only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant

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ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Jackie, Feng Wu, Han-Chi For and on behalf of PricewaterhouseCoopers, Taiwan March 30, 2021

------------------------------------------------------------------------------------------------------------------------------------------------The accompanying parent company only financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying parent company only financial statements and independent auditors’ report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in the Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

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FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Assets	Notes 6(1) 6(2) 6(4) 6(5) 7 7 6(6) 6(3) 6(7) 6(8) 6(9) 6(11) 6(25)	December31,2020 AMOUNT % $ 2,341,791 2 4,337 - - - 15,696,185 11 579,018 - 2,141,747 1 2,423,129 2 13,783 - 23,199,990 16 2,007,916 1 123,097,456 83 71,220 - 1,315 - 120,983 - 73,479 - 8,000 - 125,380,369 84 $ 148,580,359 100	December31,2019	December31,2019
		AMOUNT $ 2,341,791 4,337 - 15,696,185 579,018 2,141,747 2,423,129 13,783 23,199,990 2,007,916 123,097,456 71,220 1,315 120,983 73,479 8,000 125,380,369 $ 148,580,359	AMOUNT $ 6,369,328 10,946 3,457,000 10,387,754 905,378 79,317 422,313 14,555 21,646,591 1,271,373 120,816,539 71,979 2,001 123,571 45,281 8,000 122,338,744 $ 143,985,335	%
Current assets 1100 Cash and cash equivalents 1110 Current financial assets at fair value through profit or loss 1136 Financial assets at amortized cost- current 1170 Accounts receivable, net 1180 Accounts receivable due from related parties, net 1200 Other receivables 130X Inventories 1470 Other current assets 11XX Total current assets Non-current assets 1517 Non-current financial assets at fair value through other comprehensive income 1550 Investments accounted for using equity method 1600 Property, plant and equipment 1755 Right-of-use assets 1760 Investment property - net 1840 Deferred tax assets 1900 Other non-current assets 15XX Total non-current assets 1XXX Total assets				5 - 2 7 1 - - -
				15
				1 84 - - - - -
				85
				100

(Continued)

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FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY BALANCE SHEETS DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Liabilities and Equity	Notes 6(12) 6(2) 7 6(13) 6(25) 7 6(25) 7 6(14) 6(15) 6(16) 6(17) 6(18) 9 11	December31,2020 AMOUNT % $ 14,518,000 10 214,420 - 2,352,892 2 16,086,768 11 3,706,830 2 830,262 1 689 - 111,779 - 37,821,640 26 408,950 - 638 - 33,634 - 443,222 - 38,264,862 26 14,144,852 9 7,527,365 5 12,731,133 9 - - 68,602,338 46 7,309,809 5 110,315,497 74 $ 148,580,359 100	December31,2019	December31,2019
		AMOUNT $ 14,518,000 214,420 2,352,892 16,086,768 3,706,830 830,262 689 111,779 37,821,640 408,950 638 33,634 443,222 38,264,862 14,144,852 7,527,365 12,731,133 - 68,602,338 7,309,809 110,315,497 $ 148,580,359	AMOUNT $ 14,785,129 99,427 1,888,146 15,630,547 1,648,200 704,752 683 105,338 34,862,222 483,673 1,327 18,688 503,688 35,365,910 14,144,852 7,527,178 12,018,153 46,492 68,099,323 6,783,427 108,619,425 $ 143,985,335	%
Current liabilities 2100 Short-term loans 2120 Current financial liabilities at fair value through profit or loss 2170 Accounts payable 2180 Accounts payable to related parties 2200 Other payables 2230 Current tax liabilities 2280 Current lease liabilities 2300 Other current liabilities 21XX Total current liabilities Non-current liabilities 2570 Deferred tax liabilities 2580 Non-current lease liabilities 2600 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity Share capital 3110 Ordinary share Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 3XXX Total equity Commitments and Contingent Liabilities Significant Subsequent Events 3X2X Total liabilities and equity				10 - 1 11 1 1 - -
				24
				1 - -
				1
				25
				10 5 8 - 47 5
				75
				100

The accompanying notes are an integral part of these parent company only financial statements.

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FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except for earnings per share amounts)

Items

YearendedDecember31 2020 2019 Notes AMOUNT % AMOUNT % 6(19) and 7 $ 78,290,566 100 $ 66,650,972 100 6(6)(23) and 7 ( 74,418,416 )( 95) ( 63,119,421 ) ( 95) 3,872,150 5 3,531,551 5 6(23) ( 213,569 ) - ( 170,207 ) - ( 247,212 ) - ( 156,369 ) - ( 343,975 )( 1) ( 207,295 ) ( 1) ( 804,756 )( 1) ( 533,871 ) ( 1) 3,067,394 4 2,997,680 4 6(20) 13,119 - 171,637 - 6(21) 34,379 - 39,864 - 6(22) ( 119,085 ) - 134,891 - ( 120,554 ) - ( 337,898 ) - 6(7) 2,497,760 3 4,797,055 7 2,305,619 3 4,805,549 7 5,373,013 7 7,803,229 11 ( 654,670 )( 1) ( 673,428 ) ( 1) $ 4,718,343 6 $ 7,129,801 10 6(14) ( $ 15,784 ) - ($ 7,489 ) - 6(18) 736,543 1 ( 144,473 ) ( 1) 6(18) 1,526,103 2 10,522,950 16 6(25) 3,157 - 1,498 - 2,250,019 3 10,372,486 15 6(18) ( 1,736,264 ) ( 2) ( 3,548,558 ) ( 5) - - - - ( 1,736,264 )( 2) ( 3,548,558 ) ( 5) $ 5,232,098 7 $ 13,953,729 20 6(26) $ 3.34 $ 5.04 $ 3.32 $ 5.01

4000 Operating revenue 5000 Operating costs 5900 Gross profit from operations Operating expenses 6100 Selling expenses 6200 Administrative expenses 6300 Research and development expenses 6000 Total operating expenses 6900 Net operating income Non-operating income and expenses 7100 Interest income 7010 Other income 7020 Other gains and losses 7050 Finance costs 7070 Share of profits of associates and joint ventures accounted for using equity method 7000 Total non-operating income and expenses 7900 Profit before income tax 7950 Tax expense 8200 Profit Components of other comprehensive income that will not be reclassified to profit or loss 8311 Actuarial losses on defined benefit plans 8316 Unrealized gain (loss) on valuation of financial assets at fair value through other comprehensive income 8330 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will not be reclassified to profit or loss 8349 Income tax related to components of other comprehensive income that will not be reclassified to profit or loss 8310 Other comprehensive income that will not be reclassified to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Exchange differences on translation 8380 Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss 8360 Other comprehensive loss that will be reclassified to profit or loss 8500 Total comprehensive income Basic earnings per share (in dollars) 9750 Basic earnings per share 9850 Diluted earnings per share

The accompanying notes are an integral part of these parent company only financial statements.

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FOXCONN TECHNOLOGY CO., LTD. PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

Year ended December 31, 2019 Balance at January 1, 2019 Profit Other comprehensive income (loss) Total comprehensive income (loss) Appropriations and distribution of 2018 earnings Legal reserve Special reserve Cash dividends Changes in equity of associates and joint ventures accounted for using equity method Balance at December 31, 2019 Year ended December 31, 2020 Balance at January 1, 2020 Profit (loss) Other comprehensive income (loss) Total comprehensive income (loss) Appropriations and distribution of 2019 earnings Legal reserve Special reserve reversal Cash dividends Changes in equity of associates and joint ventures accounted for using equity method Balance at December 31, 2020	Notes		Ordinary share		Capitalsurplus				RetainedEarnings			Other EquityInterest	Other EquityInterest	Other EquityInterest		Totalequity
							Legal reserve		Special reserve		Unappropriated retained earnings	Financial statements translation differences of foreignoperations		Unrealized gains (losses) from financial assets measured at fair value through other comprehensive income
	6(17) 6(17)		$ 14,144,852 - - - - - - - $ 14,144,852 $ 14,144,852 - - - - - - - $ 14,144,852	$ 7,767,553 - - - - - - ( 240,375 ) $ 7,527,178 $ 7,527,178 - - - - - - 187 $ 7,527,365			$ 11,103,487 - - - 914,666 - - - $ 12,018,153 $ 12,018,153 - - - 712,980 - - - $ 12,731,133	$ - - - - - 46,492 - - $ 46,492 $ 46,492 - - - - ( 46,492 ) - - $ -		$ 66,542,261 7,129,801 ( 5,991 ) 7,123,810 ( 914,666 ) ( 46,492 ) ( 4,526,353 ) ( 79,237 ) $ 68,099,323 $ 68,099,323 4,718,343 ( 12,627 ) 4,705,716 ( 712,980 ) 46,492 ( 3,536,213 ) - $ 68,602,338		($ 2,578,011 ) - ( 3,548,558 ) ( 3,548,558 ) - - - - ($ 6,126,569 ) ($ 6,126,569 ) - ( 1,736,264 ) ( 1,736,264 ) - - - - ($ 7,862,833 )		$ 2,531,519 - 10,378,477 10,378,477 - - - - $ 12,909,996 $ 12,909,996 - 2,262,646 2,262,646 - - - - $ 15,172,642	$ 99,511,661 7,129,801 6,823,928 13,953,729 - - ( 4,526,353 ) ( 319,612 ) $ 108,619,425 $ 108,619,425 4,718,343 513,755 5,232,098 - - ( 3,536,213 ) 187 $ 110,315,497

The accompanying notes are an integral part of these parent company only financial statements.

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FOXCONN TECHNOLOGY CO., LTD.

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars)

CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax Adjustments Adjustments to reconcile profit (loss) Depreciation (including investment property) Amortization Expected credit loss (gain) Interest expense Share of profits of associates and joint ventures accounted for using equity method Net loss on financial assets or liabilities at fair value through profit or loss Loss (gain) on disposal of property, plant and equipment Dividend income Interest income Changes in operating assets and liabilities Changes in operating assets Accounts receivable, net Accounts receivable due from related parties Other receivables Inventories Changes in operating liabilities Accounts payable Accounts payable to related parties Other payables Other current liabilities Cash (outflow) inflow generated from operations Income tax paid Net cash flows (used in) from operating activities CASH FLOWS FROM INVESTING ACTIVITIES Net decrease (increase) in financial assets at amortized cost- current Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Interest received Dividends received Other current assets Net cash flows from (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES (Decrease) increase in short-term loans Cash dividends paid Payments of lease liabilities Interest paid Other non-current liabilities Net cash flows used in financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Years ended December 31 Notes 2020 2019 $ 5,373,013 $ 7,803,229 6(23) 4,950 7,778 6(23) - 1,146 12(2) 1,324 ( 658 ) 120,554 337,898 6(7) ( 2,497,760 ) ( 4,797,055 ) 121,602 616,129 1,536 ( 1,460 ) 6(21) ( 15,341 ) ( 12,856 ) 6(20) ( 13,119 ) ( 171,637 ) ( 5,309,814 ) 2,347,324 326,419 68,953 ( 117,408 ) 7,196 ( 2,000,816 ) ( 153,152 ) 464,746 562,610 456,221 ( 3,716,792 ) 92,594 ( 155,221 ) 6,441 20,919 ( 2,984,858 ) 2,764,351 ( 628,924 ) ( 1,068,544 ) ( 3,613,782 ) 1,695,807 3,457,000 ( 2,957,000 ) 6(8) ( 2,998 ) - 545 3,664 29,444 158,300 22,210 104,293 772 852 3,506,973 ( 2,689,891 ) ( 267,129 ) 1,095,969 6(17) ( 3,536,213 ) ( 4,526,353 ) ( 683 ) ( 699 ) ( 115,865 ) ( 327,754 ) ( 838 ) ( 1,591 ) ( 3,920,728 ) ( 3,760,428 ) ( 4,027,537 ) ( 4,754,512 ) 6,369,328 11,123,840 $ 2,341,791 $ 6,369,328

The accompanying notes are an integral part of these parent company only financial statements.

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FOXCONN TECHNOLOGY CO., LTD. NOTES TO THE PARENT COMPANY ONLY FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2020 AND 2019

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

1. HISTORY AND ORGANIZATION

FOXCONN Technology Co., Ltd. (the “Company”), originally known as Q-RUN Technology Co., Ltd., was established on April 26, 1990. On March 1, 2004, the Company merged with Foxconn Precision Components Co., Ltd. and was renamed as Foxconn Technology Co., Ltd. The Company is primarily engaged in manufacturing, processing and sales of case, heat dissipation modules and consumer electronics products.

1. THE DATE OF AUTHORIZATION FOR ISSUANCE OF THE FINANCIAL STATEMENTS AND PROCEDURES FOR AUTHORIZATION

The accompanying parent company only financial statements were authorized for issuance by the Board of Directors on March 30, 2021.

1. APPLICATION OF NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

(1) Effect of the adoption of new issuances of or amendments to International Financial Reporting Standards (“IFRS”) as endorsed by the Financial Supervisory Commission (“FSC”)

New standards, interpretations and amendments endorsed by the FSC effective from 2020 are as follows:

follows:
New Standards,Interpretations and Amendments	Effective Date by International Accounting Standards Board
Amendments to IAS 1 and IAS 8, ‘Disclosure initiative-definition of material’ Amendments to IFRS 3, ‘Definition of a business’ Amendments to IFRS 9, IAS 39 and IFRS 7, ‘Interest rate benchmark reform’ Amendment to IFRS 16, ‘Covid-19-related rent concessions’	January 1, 2020 January 1, 2020 January 1, 2020 June 1, 2020 (Note)

Note: Earlier application from January 1, 2020 is allowed by the FSC. The above standards and interpretations have no significant impact to the Company’s financial condition and financial performance based on the Company’s assessment. (2) Effect of new issuances of or amendments to IFRSs as endorsed by the FSC but not yet adopted by

the Company

New standards, interpretations and amendments endorsed by the FSC effective from 2021 are as follows:

follows:
New Standards,Interpretations and Amendments	Effective Date by International Accounting Standards Board
Amendments to IFRS 4, ‘Extension of the temporary exemption from applying IFRS 9’ Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16, ‘Interest Rate Benchmark Reform— Phase 2’	January 1, 2021 January 1, 2021

The above standards and interpretations have no significant impact to the Company’s financial

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condition and financial performance based on the Company’s assessment.

(3) IFRSs issued by IASB but not yet endorsed by the FSC

New standards, interpretations and amendments issued by IASB but not yet included in the IFRSs as endorsed by the FSC are as follows:

Effective Date by International Accounting New Standards, Interpretations and Amendments Standards Board Amendments to IFRS 3, ‘Reference to the conceptual January 1, 2022 framework’ Amendments to IFRS 10 and IAS 28, ‘Sale or contribution of To be determined by assets between an investor and its associate or joint venture’ International Accounting Standards Board IFRS 17, ‘Insurance contracts’ January 1, 2023 Amendments to IFRS 17, 'Insurance contracts' January 1, 2023 Amendments to IAS 1, ‘Classification of liabilities as current or January 1, 2023 non-current’ Amendments to IAS 1, ‘Disclosure of accounting policies’ January 1, 2023 Amendments to IAS 8, ‘Definition of accounting estimates’ January 1, 2023 Amendments to IAS 16, ‘Property, plant and equipment: January 1, 2022 proceeds before intended use’ Amendments to IAS 37, ‘Onerous contracts— January 1, 2022 cost of fulfilling a contract’ Annual improvements to IFRS Standards 2018–2020 January 1, 2022

The above standards and interpretations have no significant impact to the Company’s financial condition and financial performance based on the Company’s assessment.

4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of the accompanying parent company only financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(1) Compliance statement

The accompanying parent company only financial statements of the Company have been prepared in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”.

(2) Basis of preparation

• A. Except for the following items, the accompanying parent company only financial statements have been prepared under the historical cost convention:

• (a) Financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

• (b) Financial assets at fair value through other comprehensive income.

• (c) Defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation.

• B. The preparation of financial statements in conformity with International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use of certain

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critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the accompanying parent company only financial statements are disclosed in Note 5.

• (3) Foreign currency translation

The accompanying parent company only financial statements are presented in New Taiwan dollars, which is the Company’s functional and presentation currency.

• A. Foreign currency transactions and balances

• (a) Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognized in profit or loss in the period in which they arise.

• (b) Monetary assets and liabilities denominated in foreign currencies at the period end are retranslated at the exchange rates prevailing at the balance sheet date. Exchange differences arising upon re-translation at the balance sheet date are recognized in profit or loss.

• (c) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated at the exchange rates prevailing at the balance sheet date; their translation differences are recognized in other comprehensive income. However, nonmonetary assets and liabilities denominated in foreign currencies that are not measured at fair value are translated using the historical exchange rates at the dates of the initial transactions.

• (d) All foreign exchange gains and losses are presented in the statement of comprehensive income within ‘other gains and losses’.

• B. Translation of foreign operations

• (a) The operating results and financial position of all the company, associates and joint arrangements that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

  • i. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet;

  • ii. Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period; and

  • iii. All resulting exchange differences are recognized in other comprehensive income.

• (b) When the foreign operation partially disposed of or sold is an associate, exchange differences that were recorded in other comprehensive income are proportionately reclassified to profit or loss as part of the gain or loss on sale.

• (c) When the foreign operation partially disposed of or sold is a subsidiary, cumulative exchange differences that were recorded in other comprehensive income are proportionately transferred to the non-controlling interest in this foreign operation. In addition, even the Company still retains partial interest in the former foreign subsidiary after losing control of the former foreign subsidiary, such transactions should be accounted for as disposal of all interest in the foreign operation.

(4) Classification of current and non-current items

• A. Assets that meet one of the following criteria are classified as current assets; otherwise they are classified as non-current assets:

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  - (a) Assets arising from operating activities that are expected to be realized, or are intended to be sold or consumed within the normal operating cycle;

  - (b) Assets held mainly for trading purposes;

  - (c) Assets that are expected to be realized within twelve months from the balance sheet date;

  - (d) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

• B. Liabilities that meet one of the following criteria are classified as current liabilities; otherwise they are classified as non-current liabilities:

  • (a) Liabilities that are expected to be paid off within the normal operating cycle;

  • (b) Liabilities arising mainly from trading activities;

  • (c) Liabilities that are to be paid off within twelve months from the balance sheet date;

  • (d) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

• (5) Cash equivalents

• Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.

• (6) Financial assets at fair value through profit or loss

• A. Financial assets at fair value through profit or loss are financial assets that are not measured at amortized cost or fair value through other comprehensive income. Financial assets at amortized cost or fair value through other comprehensive income are designated as of fair value through profit or loss at initial recognition when they eliminate or significantly reduce a measurement or recognition inconsistency.

• B. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognized and derecognized using trade date accounting.

• C. At initial recognition, the Group measures the financial assets at fair value and recognizes the transaction costs in profit or loss. The Company subsequently measures the financial assets at fair value, and recognizes the gain or loss in profit or loss.

• D. The Company recognizes the dividend income when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Company and the amount of the dividend can be measured reliably.

• (7) Financial assets at fair value through other comprehensive income

• A. Financial assets at fair value through other comprehensive income comprise equity securities which are not held for trading, and for which the Company has made an irrevocable election at initial recognition to recognize changes in fair value in other comprehensive income and debt instruments which meet all of the following criteria:

  • (a) The objective of the Company’s business model is achieved both by collecting contractual cash flows and selling financial assets; and

  • (b) The assets’ contractual cash flows represent solely payments of principal and interest.

• B. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognized and derecognized using trade date accounting.

• C. At initial recognition, the Company measures the financial assets at fair value plus transaction

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costs. The Company subsequently measures the financial assets at fair value:

• (a) The changes in fair value of equity investments that were recognized in other comprehensive income are reclassified to retained earnings and are not reclassified to profit or loss following the derecognition of the investment. Dividends are recognized as revenue when the right to receive payment is established, future economic benefits associated with the dividend will flow to the Group and the amount of the dividend can be measured reliably.

• (b) Except for the recognition of impairment loss, interest income and gain or loss on foreign exchange which are recognized in profit or loss, the changes in fair value of debt instruments are taken through other comprehensive income. When the financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss.

(8) Financial assets at amortized cost

• A. Financial assets at amortized cost are those that meet all of the following criteria:

• (a) The objective of the Company’s business model is achieved by collecting contractual cash flows.

• (b) The assets’ contractual cash flows represent solely payments of principal and interest.

• B. On a regular way purchase or sale basis, financial assets at amortized cost are recognized and derecognized using trade date accounting.

• C. At initial recognition, the Company measures the financial assets at fair value plus transaction costs. Interest income from these financial assets is included in finance income using the effective interest method. A gain or loss is recognized in profit or loss when the asset is derecognized or impaired.

• D. The Company’s time deposits which do not fall under cash equivalents are those with a short maturity period and are measured at initial investment amount as the effect of discounting is immaterial.

• (9) Accounts and notes receivable

• A. Accounts and notes receivable entitle the Company a legal right to receive consideration in exchange for transferred goods or rendered services.

• B. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

• (10) Impairment of financial assets

• For debt instruments measured at fair value through other comprehensive income and financial assets at amortized cost including accounts receivable or contract assets that have a significant financing component, at each reporting date, the Company recognizes the impairment provision for 12 months expected credit losses if there has not been a significant increase in credit risk since initial recognition or recognizes the impairment provision for the lifetime expected credit losses (ECLs) if such credit risk has increased since initial recognition after taking into consideration all reasonable and verifiable information that includes forecasts. On the other hand, for accounts receivable or contract assets that do not contain a significant financing component, the Company recognizes the impairment provision for lifetime ECLs.

(11) Derecognition of financial assets

• The Company derecognizes a financial asset when the contractual rights to receive the cash flows from the financial asset expires.

– (12) Leasing agreements (lessor) operating leases

Lease income from an operating lease (net of any incentives given to the lessee) is recognized in profit or loss on a straight-line basis over the lease term.

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(13) Inventories

Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted-average method. The cost of finished goods and work in process comprises raw materials, direct labour, other direct costs and related production overheads (allocated based on normal operating capacity). It excludes borrowing costs. The item by item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less the estimated cost of completion and applicable variable selling expenses.

(14) Investments accounted for under equity method / subsidiaries and associates

• A. Subsidiary is an entity where the Company has the right to dominate its finance and operation policies (includes special purpose entity), normally the Company owns more than 50 percent of the voting rights directly or indirectly in that entity. Subsidiaries are accounted for under the equity method in the Company's parent company only financial statements.

• B. Unrealized gains or losses resulted from inter-company transactions with subsidiaries are eliminated. Necessary adjustments are made to the accounting policies of subsidiaries, to be consistent with the accounting policies of the Company.

• C. After acquisition of subsidiaries, the Company recognizes proportionately for the share of profit and loss and other comprehensive incomes in the income statement as part of the Company's profit and loss and other comprehensive income, respectively. When the share of loss from a subsidiary exceeds the carrying amount of Company's interests in that subsidiary, the Company continues to recognize its shares in the subsidiary's loss proportionately.

• D. Associates are all entities over which the Company has significant influence but not control. In general, it is presumed that the investor has significant influence, if an investor holds, directly or indirectly 20 per cent or more of the voting power of the investee. Investments in associates are accounted for using the equity method and are initially recognized at cost.

• E. The Company’s share of its investements’ post-acquisition profits or losses is recognized in profit or loss, and its share of post-acquisition movements in other comprehensive income is recognized in other comprehensive income. When the Company’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Company does not recognize further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate.

• F. When changes in an associate’s equity do not arise from profit or loss or other comprehensive income of the associate and such changes do not affect the Company’s ownership percentage of the associate, the Company recognizes change in ownership interests in the associate in ‘capital surplus’ in proportion to its ownership.

• G. Unrealized gains on transactions between the Company and its associates are eliminated to the extent of the Company’s interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Company.

• H. In the case that an associate issues new shares and the Company does not subscribe or acquire new shares proportionately, which results in a change in the Company’s ownership percentage of the associate but maintains significant influence on the associate, then ‘capital surplus’ and ‘investments accounted for under the equity method’ shall be adjusted for the increase or decrease of its share of equity interest. If the above condition causes a decrease in the Company’s ownership percentage of the associate, in addition to the above adjustment, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified

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to profit or loss proportionately on the same basis as would be required if the relevant assets or liabilities were disposed of.

• I. Upon loss of significant influence over an associate, the Company remeasures any investment retained in the former associate at its fair value. Any difference between fair value and carrying amount is recognized in profit or loss.

• J. When the Company disposes its investment in an associate and loses significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss, on the same basis as would be required if the relevant assets or liabilities were disposed of. If it retains significant influence over this associate, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionately in accordance with the aforementioned approach.

• K. When the Company disposes its investment in an associate and loses significant influence over this associate, the amounts previously recognized as capital surplus in relation to the associate are transferred to profit or loss. If it retains significant influence over this associate, the amounts previously recognized as capital surplus in relation to the associate are transferred to profit or loss proportionately.

• L. According to “Rules Governing the Preparations of Financial Statements by Securities Issuers”, 'profit for the year' and 'other comprehensive income for the year' reported in an entity's parent company only statement of comprehensive income, shall equal to 'profit for the year' and 'other comprehensive income' attributable to owners of the parent reported in that entity's consolidated statement of comprehensive income. Total equity reported in an entity's parent company only financial statements, shall be equal to the equity attributable to owners of parent reported in that entity's consolidated financial statements.

• (15) Property, plant and equipment

• A. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized.

• B. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

• C. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Each part of an item of property, plant, and equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately.

• D. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each financial year-end. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, ‘Accounting Policies, Changes in Accounting Estimates and Errors’, from the date of the change. The estimated useful lives for buildings and structures, machinery and equipment and other equipment are 3~55 years, 1~10 years and 1~10 years, respectively.

• (16) Leasing arrangements (lessee) － right-of-use assets/ lease liabilities

• A. Leases are recognized as a right-of-use asset and a corresponding lease liability at the date at which the leased asset is available for use by the Company. For short-term leases or leases of low value assets, lease payments are recognized as an expense on a straight-line basis over the

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lease term.

• B. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments are comprised of fixed payments, less any lease incentives receivable.

The Company subsequently measures the lease liability at amortized cost using the interest method and recognizes interest expense over the lease term. The lease liability is remeasured and the amount of remeasurement is recognized as an adjustment to the right-of-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

• C. At the commencement date, the right-of-use asset is stated at cost comprising the following: (a) The amount of the initial measurement of lease liability;

• (b) Any lease payments made at or before the commencement date; and

• (c) Any initial direct costs incurred by the lessee.

The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. When the lease liability is remeasured, the amount of remeasurement is recognized as an adjustment to the right-of-use asset.

• (17) Investment property

An investment property is stated initially at its cost and measured subsequently using the cost model. Except for land, investment property is depreciated on a straight-line basis over its estimated useful life of 8 ~ 55 years.

• (18) Impairment of non-financial assets

• The Company assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell or value in use. When the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortized historical cost would have been if the impairment had not been recognized.

• (19) Loans

• A. Loans comprise long-term and short-term bank loans and other long-term and short-term loans. Loans are recognized initially at fair value, net of transaction costs incurred. Loans are subsequently stated at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in profit or loss over the period of the loans using the effective interest method.

• B. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates.

• (20) Accounts and notes payable

• A. Accounts payable are liabilities for purchases of raw materials, goods or services and notes payable are those resulting from operating and non-operating activities.

• B. The short-term notes and accounts payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

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(21) Financial liabilities at fair value through profit or loss

• A. Financial liabilities are classified in this category of held for trading if acquired principally for the purpose of repurchasing in the short-term. Derivatives are also categorized as financial liabilities held for trading unless they are designated as hedges.

• B. At initial recognition, the Company measures the financial liabilities at fair value. All related transaction costs are recognized in profit or loss. The Company subsequently measures these financial liabilities at fair value with any gain or loss recognized in profit or loss.

(22) Derecognition of financial liabilities

A financial liability is derecognized when the obligation specified in the contract is either discharged or cancelled or expires.

(23) Offsetting financial instruments

Financial assets and liabilities are offset and reported in the net amount in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously.

(24) Employee benefits

• A. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognized as expenses in that period when the employees render service.

• B. Pensions

• (a) Defined contribution plan

For defined contribution plan, the contributions are recognized as pension expenses when they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments.

  - (b) Defined benefit plan

     - i. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Company in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plan is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using interest rates of government bonds (at the balance sheet date) of a currency and term consistent with the currency and term of the employment benefit obligations.

     - ii. Remeasurements arising on defined benefit plan are recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.

     - iii. Past service costs are recognized immediately in profit or loss.

• C. Employees’ compensation, directors’ and supervisors’ remuneration

  • Employees’ compensation and directors’ and supervisors’ remuneration are recognized as expenses and liabilities, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates. If employees’ compensation is paid by shares, the Group calculates the number of shares based on the closing price at the previous day of the board meeting resolution .

• (25) Income tax

• A. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit or loss, except to the extent that it relates to items recognized in other comprehensive income or

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items recognized directly in equity, in which cases the tax is recognized in other comprehensive income or equity.

• B. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.

• C. Deferred tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred tax is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realized or the deferred tax liability is settled.

• D. Deferred tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At each balance sheet date, unrecognized and recognized deferred tax assets are reassessed.

• E. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. Deferred tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities and they are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously.

• (26) Dividends

Dividends are recorded in the Company’s financial statements in the period in which they are approved by the Company’s shareholders. Cash dividends are recorded as liabilities; stock dividends are recorded as stock dividends to be distributed and are reclassified to ordinary shares on the effective date of new shares issuance.

• (27) Revenue recognition

• A. The Company is primarily engaged in manufacturing and sales of consumer electronics products. Sales are recognized when control of the products has transferred, being when the products are delivered to the customer, the customer has full discretion over the channel and price to sell the products, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. Delivery occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the products in accordance with the sales contract, or the Company has objective evidence that all criteria for acceptance have been satisfied.

• B. Revenue from these sales is recognized based on the price specified in the contract, net of the estimated sales discounts and allowances. Revenue is only recognized to the extent that it is highly probable that a significant reversal will not occur. The estimation is subject to an assessment at each reporting date. As the time interval between the transfer of committed goods

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or service and the payment of customer does not exceed one year, the Company does not adjust the transaction price to reflect the time value of money.

• C. A receivable is recognized when the goods are delivered as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

5. CRITICAL ACCOUNTING JUDGEMENTS, ESTIMATES AND KEY SOURCES OF ASSUMPTION UNCERTAINTY

The preparation of the accompanying parent company only financial statements requires management to make critical judgements in applying the Company’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year; and the related information is addressed below:

• (1) Critical judgements in applying the Company’s accounting policies Revenue recognition

The Company determines whether the nature of its performance obligation is to provide the specified goods or services itself (i.e. the Company is a principal) or to arrange for the other party to provide those goods or services (i.e. the Company is an agent) based on the transaction model and its economic substance. The Company is a principal if it controls a promised good or service before it transfers the good or service to a customer. The Company recognizes revenue at gross amount of consideration to which it expects to be entitled in exchange for those goods or services transferred. The Company is an agent if its performance obligation is to arrange for the provision of goods or services by another party. The Company recognizes revenue at the amount of any fee or commission to which it expects to be entitled in exchange for arranging for the other party to provide its goods or services. Indicators that the Company controls the good or service before it is provided to a customer include the following:

The Company provides integrated electronics manufacturing services to meet the following criteria by judgment, and recognizes revenue on a gross basis:

• A. The Company is primarily responsible for the provision of goods or services;

• B. The Company assumes the inventory risk before transferring the specified goods or services to the customer or after transferring control of the goods or services to the customer.

• C. The Company has discretion in establishing prices for the goods or services.

• (2) Critical accounting estimates and assumptions Evaluation of inventories

As inventories are stated at the lower of cost and net realizable value, the Company must determine the net realizable value of inventories on balance sheet date using judgements and estimates. Due to the rapid technology innovation, the Company evaluates the amounts of normal inventory consumption, obsolete inventories or inventories without market selling value on balance sheet date, and writes down the cost of inventories to the net realizable value. Such an evaluation of inventories is principally based on the demand for the products within the specified period in the future. Therefore, there might be material changes to the evaluation.

As of December 31, 2020, information on the carrying amount of inventories is provided in Note 6(6).

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1. DETAILS OF SIGNIFICANT ACCOUNTS

(1) Cash and cash equivalents

TAILS OF SIGNIFICANT ACCOUNTS Cash and cash equivalents
Checking accounts and demand deposits Cash equivalents Time deposits	December 31,2020 2,341,791 $ - 2,341,791 $	December 31,2019
		2,981,588 $ 3,387,740 6,369,328 $

• A. The Company associates with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

• B. The Company has no cash and cash equivalents pledged to others. Time deposits with maturity in excess of three months as of December 31, 2019 have been listed under “financial assets at amortized cost-current”.

• (2) Financial assets or liabilities at fair value through profit or loss

Assets Current items: Financial assets mandatorily measured at fair value through profit or loss Derivatives Liabilities Current items: Financial liabilities mandatorily measured at fair value through profit or loss Derivatives	December 31,2020 4,337 $ 214,420 $	December 31,2019
		10,946 $ 99,427 $

• A. Amounts recognized in profit or loss in relation to financial assets and liabilities at fair value through profit or loss are listed below:

hrough profit or loss are listed below:
Financial assets and liabilities mandatorily measured at fair value through profit or loss Derivatives	Years ended December31,
	2020 526,247) ($	2019 51,551 $

• B. The Company entered into contracts relating to derivative financial assets or liabilities which were not accounted for under hedge accounting. The information is listed below:

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Derivative instruments Current items: Foreign exchange contracts Forward exchange contracts Derivative instruments Current items: Foreign exchange contracts Cross currency swap contracts Forward exchange contracts	December 31,2020	December 31,2020
	Contractperiod TWD (SELL) 4,526,106 2020/03~2021/03 USD (BUY) 152,000 USD (SELL) 4,000 2020/11~2021/03 CNH (BUY) 27,174 Contract amount (Nominal Principal in thousands) December 31,2019	Contractperiod
	TWD (SELL) 4,567,904 USD (BUY) 152,000 TWD (SELL) 4,291,170 HKD (BUY) 1,090,878 TWD (SELL) 924,300 USD (BUY) 30,000 USD (SELL) 16,000 CNH (BUY) 112,480 (Nominal Principal in thousands) Contract amount	Contractperiod
		2019/03~2020/03 2019/03~2020/03 2019/03~2020/03 2019/11~2020/02

(a) Cross currency swap contracts

The Company signed cross currency swap contracts aiming to satisfy capital requirements. Under the terms of exchange rate swaps, the principal in two currencies are exchanged at the beginning and the end of period to reduce exchange rate risk. Under the terms of rate swaps, the fixed interest rates of two currencies are exchanged to reduce interest rate risk.

(b) Forward exchange contracts

The Company signed forward exchange contracts to hedge exchange rate risks arising from the activities listed below:

• i. Business activity: The payables due from importing materials and supplies as well as receivables from exports.

• ii. Investment activity: The payment due from importing machinery and equipment.

• iii. Financial activity: Assets and liabilities (financing) resulting from long-term or short-term loans.

(c) Foreign exchange contracts

The Company entered into foreign exchange contracts to satisfy capital requirements. The principal in two currencies are swapped using the same exchange rate at the beginning and the end of the period to reduce exchange rate risk.

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• C. The counterparties of derivative instruments held by the Company are all banks with good credit quality or financial institutions with investment grade credit ratings that are above A.

• D. The Company has no financial assets at fair value through profit or loss pledged to others.

• (3) Financial assets at fair value through other comprehensive income

Items Non-current items: Equity instruments	December 31,2020 2,007,916 $	December 31,2019
		1,271,373 $

• A. The Company has elected to classify equity instruments that are considered to be strategic investments as financial assets at fair value through other comprehensive income.

• B. The Company recognized other comprehensive gains (losses) of $736,543 and ($144,473) for fair value change for the years ended December 31, 2020 and 2019, respectively. The aforementioned comprehensive gains (losses) recognized that are related to the fair value change of Energy Information System Co., Ltd. for the years ended December 31, 2020 and 2019 amounted to $736,000 and ($177,304), respectively.

• C. As of December 31, 2020, the Company has no financial assets at fair value through other comprehensive income pledged to others.

• (4) Financial assets at amortized cost

comprehensive income pledged to others. Financial assets at amortized cost
Items Current items: Time deposits with maturity in excess of three months	December 31,2020 - $	December 31,2019
		3,457,000 $

• A. As of December 31, 2020 and 2019, the Company has no financial assets at amortized cost pledged to others.

• B. The Company transacts with reputable financial institutions and the probability of default is expected to be very low.

• (5) Accounts receivable

expected to be very low. Accounts receivable
Accounts receivable Less: Allowance for bad debts (	December 31,2020 15,700,830 $ 4,645) 15,696,185 $	December 31,2019
		10,391,016 $ 3,262) ( 10,387,754 $

• A. The Company does not hold any collateral as security.

• B. Information relating to credit risk is provided in Note 12(2).

• (6) Inventories

A. The Company does not hold any collateral as security. B. Information relating to credit risk is provided in Note 12(2). Inventories 15,696,185 $ 10,387,754 $	A. The Company does not hold any collateral as security. B. Information relating to credit risk is provided in Note 12(2). Inventories 15,696,185 $ 10,387,754 $	10,387,754 $
The cost of inventories recognized as expense for the year: December31,2020 December31,2019 Finished goods 2,438,858 $ 438,042 $ Less: Allowance for inventory obsolescence and market price decline 15,729) ( 15,729) ( 2,423,129 $ 422,313 $ 2020 2019 Cost of inventories sold 74,418,416 $ 63,119,421 $ Years ended December31,		December31,2019
	2020 74,418,416 $	2019
		63,119,421 $

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(7) Investments accounted for using equity method

Investments accounted for using equity method
Investees	December 31,2020		December 31,2019
At January 1	$	120,816,539		$	109,456,141
Share of profit of investments accounted for using
equity method		2,497,760			4,797,055
Dividends distributed by investments accounted for using equity method	(	6,869)	(		91,437)
Change in capital surplus		187	(		240,375)
Change in retained earnings		-	(		79,237)
Change in other equity interest (Note 6(18))	(	210,161)			6,974,392
At December 31	$	123,097,456		$	120,816,539
	December 31,2020		December 31,2019
Subsidiaries	$	122,819,878		$	120,535,189
Associates		277,578			281,350
	$	123,097,456		$	120,816,539

• A. The Company’s subsidiary:

• (a) Details of the Company’s subsidiaries are provided in Note 4(3) of the Company’s consolidated financial statements as of and for the year ended December 31, 2020.

• (b) The Company’s investments in China through FOXCONN PRECISION COMPONENTS HOLDING CO., LTD. and Q-RUN HOLDINGS LTD. are engaged in the production and sales of computer components (computer radiators, magnesium alloys and computer components). Please refer to Note 13 for the disclosure of information on investments in China.

• B. The Company’s associates:

The operating results of the Company’s share in all individually immaterial associates are summarized below:

ummarized below:
Other comprehensive loss, net of tax	Years ended December 31,
	2020 2019 18,887) ($ 24,399) ($	2019

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(8) Property, plant and equipment

Property, plant and equipment
At January 1 Cost Accumulated depreciation Opening net book amount as of January 1 Additions Transfer in Disposals Depreciation expense Closing net book amount as of December 31 At December 31 Cost Accumulated depreciation At January 1 Cost Accumulated depreciation Opening net book amount as of January 1 Transfer Disposals Depreciation expense Closing net book amount as of December 31 At December 31 Cost Accumulated depreciation							2020
	Land			Buildings and structures 54,108 $ 41,874) 12,234 $ 12,234 $ - 1,581 - 533) 13,282 $ 57,915 $ 44,633) 13,282 $			Machinery and equipment 81,038 $ 78,425) 2,613 $ 2,613 $ - - - 373) 2,240 $ 81,038 $ 78,798) 2,240 $ 2019	Others 76,857 $ 71,575) ( 5,282 $ 5,282 $ 2,998 - 2,081) ( 2,351) ( 3,848 $ 77,774 $ 73,926) ( 3,848 $
	51,850 $ - 51,850 $ 51,850 $ - - - - 51,850 $ 51,850 $ - 51,850 $		( ( (			( ( (
	Land 51,850 $ - 51,850 $ 51,850 $ - - - 51,850 $ 51,850 $ - 51,850 $			Buildings and structures
		( ( (	51,749 $ 41,540) 10,209 $ 10,209 $ 2,541 - 516) 12,234 $ 54,108 $ 41,874) 12,234 $		( ( (

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－ (9) Leasing arrangements lessee

• A. The Company leases various assets including buildings and structures. Rental contracts are typically made for a period of 5 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose covenants, and leased assets may not be used as security for borrowing purposes.

• B. Low-value assets comprise multifunction printers.

• C. The carrying amount of right-of-use assets and the depreciation expense are as follows:

Low-value assets comprise multifunction printers. The carrying amount of right-of-use assets and the	depreciation expense are as follows:	depreciation expense are as follows:	depreciation expense are as follows:	re as follows:
Buildings and structures Buildings and structures	December 31,2020 December 31,2019 Book value Book value 1,315 $ 2,001 $ 2020 2019 Depreciation expense Depreciation expense 686 $ 686 $ Years ended December 31,	December 31,2020 December 31,2019 Book value Book value 1,315 $ 2,001 $ Years ended December 31,		December 31,2019
				Book value
			2019 Depreciation expense	2019
			686 $

• D. For the years ended December 31, 2020 and 2019, there were no additions to right-of-use assets.

• E. Information on profit or loss in relation to lease contracts is as follows:

Items affecting profit or loss Interest expense on lease liabilities Expense on leases of low-value assets	Years ended December 31,	Years ended December 31,
	2020 16 $ 75	2019
		22 $ 81

• F. SFor the years ended December 31, 2020 and 2019, the Company’s total cash outflows for leases were $774 and $802, respectively.

• G. Information about the right-of-use assets that were pledged to others as collateral is provided in Note 8.

(10) Leasing arrangements - lessor

• A. The Company leases various assets including buildings. Rental contracts are typically made for a period of 4 years. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.

• B. For the years ended December 31, 2020 and 2019, the Company recognized rent income in the amount of $18,722 and $19,855, respectively, based on the operating lease agreement, which does not include variable lease payments.

• C. The maturity analysis of the lease receivables under the operating leases is as follows:

2021 2022 2023 2024 2025	December 31,2020 15,649 $ 2020 14,978 2021 4,425 2022 1,074 2023 258 2024 36,384 $	December 31,2019
		20,187 $ 20,187 19,809 7,382 1,151 68,716 $

The rent income recognized by the Company is measured based on the area actually used by the lessee. The lease receivables listed above are calculated based on the area actually used by the

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lessee at each of the balance sheet dates.

(11) Investment property

lessee at each of the balance sheet dates. Investment property
At January 1 Cost Accumulated depreciation and impairment Opening net book amount as of January 1 Transfer out Depreciation expense Closing net book amount as of December 31 At December 31 Cost Accumulated depreciation and impairment At January 1 Cost Accumulated depreciation and impairment Opening net book amount as of January 1 Transfer in Depreciation expense Closing net book amount as of December 31 At December 31 Cost Accumulated depreciation and impairment			2020
	Land 95,910 $ - 95,910 $ 95,910 $ - - 95,910 $ 95,910 $ - 95,910 $	Buildings and structures 66,584 $ 38,923) ( 27,661 $ 27,661 $ 1,581) ( 1,007) ( 25,073 $ 62,777 $ 37,704) ( 25,073 $ 2019		Total 162,494 $ 38,923) ( 123,571 $ 123,571 $ 1,581) ( 1,007) ( 120,983 $ 158,687 $ 37,704) ( 120,983 $
	Land 95,910 $ - 95,910 $ 95,910 $ - - 95,910 $ 95,910 $ - 95,910 $

A. Rental income from investment property and direct operating expenses arising from investment property are shown below:

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Rental income from investment property Direct operating expenses arising from the investment property that generated rental income during the year	Years ended December 31,	Years ended December 31,
	2020 18,722 $ 1,007 $	2019
		19,855 $
		1,167 $

• B. The fair value of the investment property held by the Company as of December 31, 2020 and 2019 was $708,791 and $677,598, respectively. Valuations were made using the income approach which is categorized within Level 3 in the fair value hierarchy.

(12) Short-term loans

Short-term loans
Other payables Type of loans December 31,2020 Bank loans Unsecured loans 14,518,000 $ Type of loans December 31,2019 Bank loans Unsecured loans 14,785,129 $ Payable for purchases made by parties on behalf of others Employees’ compensation payable Awards and salaries payable Others		Interest rate range	Collateral None Collateral None December31,2019 51,654 $ 1,460,134 36,497 99,915 1,648,200 $
		0.48%~0.80% Interest rate range
		0.59%~3.19673% December31,2020 2,013,001 $ 1,296,708 266,194 130,927 3,706,830 $

(13) Other payables

(14) Pensions

A. Defined benefit plan

(a) The Company has a defined benefit pension plan in accordance with the Labor Standards Law, covering all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Law. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last 6 months prior to retirement. The Company contributes monthly an amount equal to 2% of the employees’ monthly salaries and wages to the retirement fund deposited with Bank of Taiwan, the trustee, under the name of the independent retirement fund committee.

• (b) The amounts recognized in the balance sheet are as follows (shown as ‘other non-current liabilities’):

liabilities’):
	December	31,2020	December	31,2019
Present value of defined benefit obligations	($	67,933)	($	57,744)
Fair value of plan assets		34,299		39,056
Net defined benefit liability	($	33,634)	($	18,688)

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(c) Movements in net defined benefit liabilities are as follows:

Balance at January 1 Past service cost Interest income Remeasurements Return on plan assets (Note) Change in demographic assumptions Change in financial assumptions Experience adjustments Pension fund contribution Paid pension Balance at December 31 Balance at January 1 Current service cost Interest income Remeasurements Return on plan assets (Note) Change in demographic assumptions Change in financial assumptions Experience adjustments Pension fund contribution Paid pension Balance at December 31	Present value of defined benefit obligations 57,744) ($ 528) ( 462) ( 58,734) ( - 567) ( 2,833) ( 13,650) ( 17,050) ( - 7,851 ( 7,851 ( ($ 67,933)	Fair value of Net defined plan assets benefit liability 39,056 $ 18,688) ($ - 528) ( 319 143) ( 39,375 19,359) ( 1,266 1,266 - 567) ( - 2,833) ( - 13,650) ( 1,266 15,784) ( 1,509 1,509 7,851) - 6,342) 1,509 $34,299 33,634) ($ 2020 2019
	Present value of defined benefit obligations 51,634) ($ - 581) ( 52,215) ( - 345) ( 1,724) ( 6,853) ( 8,922) ( - 3,393 ( 3,393 ( ($ 57,744)	Fair value of Net defined plan assets benefit liability 38,843 $ 12,791) ($ - - 446 135) ( 39,289 12,926) ( 1,433 1,433 - 345) ( - 1,724) ( - 6,853) ( 1,433 7,489) ( 1,727 1,727 3,393) - 1,666) 1,727 $ 39,056 18,688) ($

Note: The amount included in interest income or expense is excluded.

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• (d) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilization plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund” (Article 6: The scope of utilization for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-thecounter, or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilization of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings is less than aforementioned rates, government shall make payment for the deficit after approval by the Regulator. The Company has no right to participate in managing and operating that fund and hence the Company is unable to disclose the classification of plan asset fair value in accordance with IAS 19 paragraph 142. The composition of fair value of plan assets as of December 31, 2020 and 2019 is given in the Annual Labor Retirement Fund Utilization Report announced by the government.

• (e) The principal actuarial assumptions used were as follows:

Discount rate Future salary increases	Years ended December 31,	Years ended December 31,
	2020 0.35% 2.00%	2019
		0.80% 2.00%

Assumptions regarding future mortality experience are set based on actuarial advice in accordance with published statistics and experience in each territory.

Because the main actuarial assumption changed, the present value of defined benefit obligation is affected. The analysis was as follows:

December 31,2020 Effect on present value of defined benefit obligation December 31,2019 Effect on present value of defined benefit obligation	Increase Decrease 0.25% 0.25% $ 1,603 ($ 1,657) $ 1,350 ($ 1,396) Discount rate	Future salaryincreases	Future salaryincreases
	Increase 0.25% $ 1,603 ( $ 1,350 (	Increase 0.25% ($ 1,585) ($ 1,340)	Decrease 0.25%
			$ 1,542 $ 1,303

The sensitivity analysis above was based on one assumption which changed while the other conditions remain unchanged. In practice, more than one assumption may change all at once. The method of analysing sensitivity and the method of calculating net pension liability in the balance sheet are the same.

• (f) Expected contributions to the defined benefit pension plans of the Company for the year ending December 31, 2021 are $1,320.

• B. Defined contribution plan

• (a) Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with R.O.C. nationality. Under the New Plan, the Company contributes monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension

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accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.

• (b) The pension costs under the defined contribution pension plan of the Company for the years ended December 31, 2020 and 2019 were $12,332 and $11,096, respectively.

• (15) Share capital

As of December 31, 2020, the Company’s authorized capital was $15,000,000 (including subscription warrant or 50 million shares reserved for convertible bonds issued by the Company), and the paid-in capital was $14,144,852, consisting of outstanding ordinary shares of 1,414,485 thousand shares with a par value of $10 (in dollars) per share.

Movements in the number of the Company’s ordinary shares outstanding are as follows:

At January 1 (December 31)	2020 Number of ordinary shares(in thousands) 1,414,485	2019
		Number of ordinary shares(in thousands)
		1,414,485

(16) Capital surplus

Pursuant to the R.O.C. Company Act, capital surplus arising from paid-in capital in excess of par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the R.O.C. Securities and Exchange Law requires that the amount of capital surplus to be capitalized mentioned above should not exceed 10% of the paid-in capital each year. Capital surplus should not be used to cover accumulated deficit unless the legal reserve is insufficient.

(17) Retained earnings

• A. In accordance with the Company’s Articles of Incorporation, current year’s earnings must be distributed in the following order:

• (a) Covering accumulated deficit;

• (b) Setting aside as legal reserve equal to 10% of current year’s net income after tax and distribution pursuant to clause (A);

• (c) Setting aside a special reserve in accordance with applicable legal and regulatory requirements.

The remaining earnings along with the unappropriated earnings at the beginning of the period are considered as accumulated distributable earnings. In accordance with dividend policy, the proposal of earnings appropriation is prepared by the Board of Directors and resolved by the shareholders.

The Company is at the growing stage. The Company’s stock dividend policy shall consider the Company’s current and future investment environment, capital needs, local and foreign competition situation and capital budget, along with shareholders’ profit and the Company’s long-term financial plans. The shareholders’ dividends are appropriated based on accumulated distributable earnings, which shall not be lower than 15% of the distributable earnings for the period and the cash dividends shall not be less than 10% of the shareholders’ dividends.

• B. According to related regulations, 10% of the balance of earnings after tax less the accumulated loss of prior years should be set aside as legal reserve, until such legal reserve amount reaches the total authorized capital. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve

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is limited to the portion in excess of 25% of the Company’s paid-in capital.

• C. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

• D. The appropriations of earnings for 2019 and 2018 had been resolved at the stockholders’ meeting on June 23, 2020 and June 21, 2019, respectively. Details are summarized below:

Years ended December 31,

Dividends per Amount share(in dollars) Legal reserve 712,980 $ Special reserve 46,492) ( Cash dividends 3,536,213 2.5 $ 4,202,701 $ 2019	Dividends per Amount share(in dollars) 914,666 $ 46,492 4,526,353 3.2 $ 5,487,511 $ 2018

The appropriations of earnings for 2020 as approved at the Board of Directors’ meeting as of March 30, 2021 is as follows:

March 30, 2021 is as follows:
Legal reserve Cash dividends	Year ended December31,2020
	Amount 470,572 $ 2,546,073 3,016,645 $	Dividends per share(in dollars)
		1.8 $

The information on distribution of earnings will be posted in the “Market Observation Post System” of the TSEC.

(18) Other equity items

System” of the TSEC. Other equity items
At January 1 Revaluation of fair value - Parent - Subsidaries Currency translation differences: - Parent and subsidaries At December 31			2020
		Unrealized gain (loss) on financial assets at fair value through other Currency comprehensive translation income adjustments 12,909,996 $ 6,126,569) ($ 736,543 - 1,526,103 - - 1,736,264) ( 15,172,642 $ 7,862,833) ($		Total 6,783,427 $ 736,543 1,526,103 1,736,264) ( 7,309,809 $

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Operating revenue At January 1 Revaluation of fair value - Parent - Subsidaries Currency translation differences: - Parent and subsidaries At December 31 Revenue from contracts with customers			2019
	Unrealized gain (loss) on financial assets at fair value through other Currency comprehensive translation income adjustments Total 2,531,519 $ 2,578,011) ($ 46,492) ($ - 144,473) ( - 144,473) ( 10,522,950 - 10,522,950 - 3,548,558) ( 3,548,558) ( 12,909,996 $ 6,126,569) ($ 6,783,427 $ 2020 2019 78,290,566 $ 66,650,972 $ Years ended December 31,

(19) Operating revenue

The Company derives revenue from the transfer of goods and services at a point in time in the following categories:

	The Company derives revenue from following categories: Revenue from contracts with custome	the transfer of goods and services at a point in time in the rs 78,290,566 $ 66,650,972 $	the transfer of goods and services at a point in time in the rs 78,290,566 $ 66,650,972 $	the transfer of goods and services at a point in time in the rs 78,290,566 $ 66,650,972 $
(20)	Interest income Revenue from contracts with customers Revenue from contracts with customers Interest income from bank deposits	Year ended December 31,2020
		Electronic products tradingservices Others Total 78,136,849 $ 153,717 $ 78,290,566 $ Year ended December 31,2019		Total
		Electronic products tradingservices 66,570,492 $ $	Others Total 80,480 $ 66,650,972 $ 2020 2019 13,119 171,637 $ Years ended December31,	Total
			2020 13,119

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(21) Other income

Other income
			Years ended	December 31,
			2020		2019
Dividend income			15,341		12,856
Rental revenue			18,722		19,855
Others			316		7,153
		$	34,379	$	39,864
Other gains and losses
			Years ended	December 31,
			2020		2019
Gains on financial assets (liabilities) at fair
value through profit or loss	($		526,247)	$	51,551
Net currency exchange gains			409,903		83,243
Others	(		2,741)		97
	($		119,085)	$	134,891

(22) Other gains and losses

Information related to gains (losses) on financial assets at fair value through profit or loss is provided in Note 6(2).

(23) Expenses by nature

in Note 6(2). Expenses by nature
Employee benefit expense Depreciation (Note) Amortization	Years ended December 31,
	2020 795,221 $ 4,950 - 800,171 $	2019
		624,021 $ 7,778 1,146
		632,945 $

Note: Including depreciation of investment property and right-of-use assets. (24) Employee benefit expense

Employee benefit expense
Wages and salaries Labor and health insurance fees Pension costs Other personnel expenses	Years ended December 31,
	2020 716,847 $ 24,230 13,003 41,141 795,221 $	2019
		556,757 $ 20,755 11,231 35,278
		624,021 $

• A. According to the Company’s Articles of Incorporation, if the Company accrues profit (referring to profit before tax prior to deducting the appropriation for employees’ compensation and directors’ remuneration), 4%~6% should be appropriated as employees’ compensation.

• B. For the years ended December 31, 2020 and 2019, employees’ compensation was accrued at $223,876 and $325,135, respectively. The aforementioned amounts were recognized in salary expenses. For the year ended December 31, 2020, the employees’ compensation was estimated and accrued based on 4% of profit of current year distributable as of the end of reporting period.

Employees’ compensation for the years ended December 31, 2020 and 2019 as resolved by the Board of Directors were in agreement with the amounts recognized in the 2020 and 2019 financial statements. For the years ended December 31, 2020 and 2019, the employees’

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compensation were distributed in the form of cash amounting to $223,876 and $325,135, respectively.

Information about employees’ compensation of the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System” at the website of the Taiwan Stock Exchange.

(25) Income tax

• A. Components of income tax expense:

Stock Exchange. ome tax Components of income tax expense:
		Years ended December 31,
		2020			2019
Current tax:
Current tax on profits for the year	$	571,093	$		602,941
Tax on undistributed surplus earnings		142,094			181,368
Prior year income tax under (over) estimation		41,247	(		368)
Total current tax		754,434			783,941
Deferred tax:
Origination and reversal of temporary
differences	(	99,764)	(		110,513)
Income tax expense	$	654,670	$		673,428
Reconciliation between income tax expense and accounting		profit:
		Years ended	December 31,
		2020			2019
Tax calculated based on profit before tax and
statutory tax rate	$	1,074,603		$	1,560,563
Exempt income according to tax law	(	603,274)	(		1,068,135)
Tax on undistributed earnings		142,094			181,368
Prior year income tax under (over) estimation		41,247	(		368)
Income tax expense		654,670			673,428
Origination and reversal of temporary differences		99,764			110,513
Prior year income tax (under) over estimation	(	41,247)			368
Prior year income tax payable		120,000			120,000
Prepaid income tax	(	2,925)	(		199,557)
Current income tax liabilities	$	830,262		$	704,752

• B. Reconciliation between income tax expense and accounting profit:

C. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows:

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January1 Temporary differences: Deferred tax assets: Reserve for inventory obsolescence 3,146 $ Permanent loss on market value decline of long-term equity investments 16,222 Unused compensated absences for employees 3,540 Unrealised loss on financial instruments 17,696 Others 4,677 ( 45,281 $ Deferred tax liabilities: Foreign investment income using equity method 442,655) ($ Others 41,018) ( ( 483,673) ($		2020
		Recognized in profit or loss - $ - 888 24,321 168) 25,041 $ 96,580 $ 21,857) 74,723 $

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January1 Temporary differences: Deferred tax assets: Reserve for inventory obsolescence 3,146 $ Permanent loss on market value decline of long-term equity investments 16,222 Unused compensated absences for employees 2,852 Unrealised loss on financial instruments - Others 38,048 ( 60,268 $ ( Deferred tax liabilities: Foreign investment income using equity method 505,141) ($ Unrealised valuation gain on financial instruments 105,530) ( Others - ( 610,671) ($		2019
		Recognized in profit or loss - $ - 688 17,696 34,869) 16,485) $ 62,486 $ 105,530 41,018) 126,998 $

D. The Company did not recognize taxable temporary differences associated with investment in subsidiaries as deferred tax liabilities. As of December 31, 2020 and 2019, the temporary differences unrecognized as deferred tax liabilities were $97,587,869 and $98,103,567, respectively. Abovementioned taxable temporary differences arose from the differences between estimated carrying amounts of long-term investments in foreign subsidiaries and tax payable. The Company will not dispose the subsidiaries in the foreseeable future nor remit back earnings and thus, did not recognize deferred income tax liabilities.

• E. The Company’s income tax returns through 2017 have been assessed and approved by the Tax Authority.

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(26) Earnings per share

Earnings per share
Basic earnings per share Net income Diluted earnings per share Net income Assumed conversion of all dilutive potential ordinary shares Employees’ compensation Net income plus assumed conversion of all dilutive potential ordinary shares Basic earnings per share Net income Diluted earnings per share Net income Assumed conversion of all dilutive potential ordinary shares Employees’ compensation Net income plus assumed conversion of all dilutive potential ordinary shares	Year ended December 31,2020
	Weighted average number of ordinary Earnings Amount shares outstanding per share after tax (shares in thousands) (in dollars) 4,718,343 $ 1,414,485 3.34 $ 4,718,343 $ - 5,991 4,718,343 $ 1,420,476 3.32 $ Weighted average number of ordinary Earnings Amount shares outstanding per share after tax (shares in thousands) (in dollars) 7,129,801 $ 1,414,485 5.04 $ 7,129,801 $ - 8,389 7,129,801 $ 1,422,874 5.01 $ Year ended December 31,2019		Earnings per share (in dollars)
	Amount after tax 7,129,801 $ 7,129,801 $ - 7,129,801 $	Weighted average number of ordinary shares outstanding (shares in thousands) 1,414,485 8,389 1,422,874

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7. RELATED PARTY TRANSACTIONS

(1) Names of related parties and relationship

LATED PARTY TRANSACTIONS Names of related parties and relationship
Names of relatedparties	Relationshipwith the Company
Hon Hai Precision Industry Co., Ltd. and Subsidiaries (Hon Hai and Subsidiaries) Hongfujin Precision Electronics (Yantai) Co., Ltd. Pan-International Industrial Corporation and Subsidiaries Innolux Corporation Sharp Corporation and Subsidiaries General Interface Solution Limited Ennoconn Corporation and Subsidiaries CyberTAN Technology, Inc. and Subsidiaries SIO International Holdings Limited Taiwan Branch	Entity with significant influence to the Company 〞 Other related party 〞 〞 〞 〞 〞 〞

For more information about the Company and other subsidiaries, please refer to Note 7.

(2) Significant related party transactions

A. Sales

nificant related party transactions Sales
Sales of goods and services: Entities with significant influence to the Company -Hon Hai and Subsidiaries Subsidiaries Other related parties	Years ended December 31,
	2020 848,925 $ 469,439 34,004 1,352,368 $	2019
		704,432 $ 553,397 43,476 1,301,305 $

Except for circumstances in which there are no similar transactions for reference and the prices and credit periods are negotiated by both parties, the aforementioned related party is offered prices very close to those offered to other customers and given a payment period of 30 to 90 days. For transactions involving the sale of raw materials to the aforementioned related party and subsequent repurchase of goods made from the same raw materials from the same party, the initial sale of raw materials is eliminated due to economic substance.

B. Management service revenue (shown as ‘operating revenue’)

Management service revenue: Subsidiaries	Years ended December 31,	Years ended December 31,
	2020 153,717 $	2019
		158,956 $

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C. Purchases

Purchases
Purchases of goods and services: Entities with significant influence to the Company -Hon Hai and Subsidiaries Subsidiaries Other related parties	Years ended December 31,
	2020 64,633,599 $ 4,492,814 5,441,003 74,567,416 $	2019
		54,708,022 $ 5,331,239 3,132,186 63,171,447 $

Except for circumstances in which there are no similar transactions for reference and the prices and payment terms are negotiated by both parties, the Company makes purchases from the aforementioned related party at the prevailing market price, with payment periods of 30 to 90 days.

D. Receivables from related parties

days. Receivables from related parties
Accounts receivable: Entities with significant influence to the Company -Hon Hai and Subsidiaries Subsidiaries Other related parties Less: Allowance for bad debts (	December 31,2020 397,483 $ 180,682 966 579,131 113) ( 579,018 $	December 31,2019
		539,571 $ 333,927 32,052 905,550 172) 905,378 $

The receivables from related parties arise mainly from sales transactions. The amount is due three months after the invoice date. The receivables are unsecured and non-interest bearing. No allowance for doubtful debts was provided against receivables from related parties.

E. Payables to related parties

Payables to related parties
Accounts payable: Entities with significant influence to the Company -Hon Hai and Subsidiaries Subsidiaries Other related parties	December 31,2020 14,263,356 $ 1,097,490 725,922 16,086,768 $	December 31,2019
		13,951,320 $ 1,058,296 620,931 15,630,547 $

The payables to related parties arise mainly from purchase transactions and are made at arm’slength, non-interest bearing and payable within 30~90 days.

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F. Raw materials purchased on behalf of others

Raw materials purchased on behalf of others
Raw materials purchased on behalf of others Entities with significant influence to the Company Other related parties Receivables for raw materials purchased on behalf of others (shown as‘other receivables’) Entities with significant influence to the Company Other related parties	Years ended December 31,
	2020 33,297,650 1,839,924 35,137,574 $ December 31,2020 1,394,124 736,129 2,130,253 $	2019
		23,940,737 - 23,940,737 $ December 31,2019
		51,333 - 51,333 $

• G. Lease transactions – lessee

• (a) The Company leases plant from entities with significant influence on the Company. Rental contracts are typically made for a period of 5 years. Rents are paid at the beginning of each month.

(b) Acquisition of right-of-use assets:

On January 1, 2019 (the date of initial application of IFRS 16), the Company increased rightof-use assets by $2,687.

• (c) Lease liabilities:

• i. Outstanding balance:

quisition of right-of-use assets: January 1, 2019 (the date of initial application use assets by $2,687. ase liabilities: Outstanding balance:	of IFRS 16), the Company increased right-	any increased right-
Interest expense Current: Entities with significant influence to the Company Non-current: Entities with significant influence to the Company Entities with significant influence to the Company	December 31,2020 December 31,2019 689 $ 683 $ 638 $ 1,327 $ Years ended December 31,	December 31,2019
	2020 16 $	2019
		22 $

ii. Interest expense

(3) Key management compensation

Key management compensation Company
Salaries and other short-term employee benefits Post-employment benefits Share-based payments	2020 2019 36,162 $ 26,031 $ 524 523 33,912 28,666 70,598 $ 55,220 $ Years ended December 31,
		2019
		26,031 $ 523 28,666 55,220 $

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8. PLEDGED ASSETS

None.

9. SIGNIFICANT CONTINGENT LIABILITIES AND UNRECOGNIZED CONTRACT

• COMMITMENTS

None.

10. SIGNIFICANT DISASTER LOSS

None.

11. SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE

As of March 30, 2021, the Company’s Board of Directors has approved the proposal for the appropriation of earnings in 2020, which can be referred to in Note 6(17).

12. OTHERS

(1) Capital management

The Company’s objectives when managing capital are to safeguard the Company’s ability to operate with the goal to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to reduce debt. The Company monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including “current and noncurrent borrowings” as shown in the consolidated balance sheet) less cash and cash equivalents. Total capital is calculated as “equity” as shown in the consolidated balance sheet less total intangible assets.

During 2020, the Company’s strategy, which was unchanged from 2019, was to maintain the gearing ratio below 70%.

(2) Financial instruments

A. Financial instruments by category

o below 70%. ancial instruments Financial instruments by category
Financial assets Financial assets at fair value through profit or loss Financial assets at fair value through other comprehensive income Financial assets at amortised cost Financial liabilities Financial liabilities at fair value through profit or loss Financial liabilities at amortised cost Lease liabilities	December 31,2020 4,337 $ 2,007,916 20,758,741 22,770,994 $ 214,420 $ 36,664,490 36,878,910 $ 1,327 $	December 31,2019
		10,946 $ 1,271,373 21,198,777 22,481,096 $ 99,427 $ 33,952,022 34,051,449 $ 2,010 $

Note: Financial assets at amortized cost included cash, accounts receivable, accounts receivable due from related parties and other receivables; financial liabilities at amortized cost included short-term loans, accounts payable, accounts payable to related parties and other payables.

• B. Risk management policies

• (a) Risk categories

The Company employs a comprehensive financial risk management and control system to

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clearly identify, measure and control the various kinds of financial risk it faces, including market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk.

• (b) Management objectives:

  • i. Except for market risk, which is controlled by outside factors, the remainder of the foregoing types of risks can be controlled internally or removed from business processes. Therefore, the goal in managing each of these risks is to reduce them to zero.

  • ii. As for market risk, the goal is to optimize its overall position through strict analysis, suggestion, execution and audit processes, and proper consideration of a) long-term trends in the external economic/financial environment, b) internal operating conditions, and c) the actual effects of market fluctuations.

  • iii. The Company’s overall risk management policy focuses on the unpredictable items in financial markets and seeks to reduce the risk that potentially pose adverse effects on the Company’s financial position and financial performance.

  • iv. For the information on the derivative financial instruments that the Company enters into, please refer to Note 6(2).

• (c) Management system:

  • i. Risk management is executed by the Company’s finance department by following policies approved by the Board. Through cooperation with the Company's operating units, finance department is responsible for identifying, evaluating and hedging financial risks.

  • ii. The Board has a written policy covering overall risk management. It also has written policies covering specific issues, such as exchange rate risk, interest rate risk, credit risk, derivative and non-derivative financial instruments used, and the investment of excess working capital.

• C. Significant financial risks and degrees of financial risks

• (a) Market risk

Foreign exchange risk

• i. Nature :

The Company is a multinational group in the electronic manufacturing services industry. Most of the exchange rate risk from operating activities comes from:

• (i) Foreign exchange risk arises from different exchange rates to functional currency as the invoice dates of accounts receivable and payable denominated in non-functional foreign currency are different. Because the amount after the assets and liabilities are offset is insignificant, income/loss is insignificant as well. (Note: The Company has several sites in various countries and thus is exposed to various foreign exchange risks. The main risk arises from USD and RMB.)

• (ii) Changes in exchange rates of functional currencies to presentation currency at different timing will cause another foreign exchange risk.

• (iii) Except for the above transactions (operating activities) recognized in the income statement, assets and liabilities recognized in the balance sheet and the net investment in foreign operations also result in the exchange rate risk.

• ii. Management:

• (i) For such risks, the Company has set up policies requiring the Company to manage its exchange rate risks.

• (ii) As to the exchange rate risk arising from the difference between various functional

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currencies and the reporting currency in the parent company only financial statements, it is managed by the Company’s finance department.

• iii. Sources of risk:

• U.S. dollars and NT dollars:

Foreign exchange risk arises primarily from gains or losses from translating U.S. dollardenominated assets, such as cash, cash equivalents, accounts receivable, other receivables and time deposits maturing in excess of three months, and U.S. dollar-denominated liabilities, such as loans, accounts payable and other payables, into New Taiwan dollars.

• iv. The information on assets and liabilities denominated in foreign currencies whose values would be materially affected by the exchange rate fluctuations is as follows:

(Foreign currency: functional currency) Financial assets Monetary items USD：NTD Non-monetary items Foreign operations USD：NTD Financial liabilities Monetary items USD：NTD		December 31,2020	December 31,2020
	Foreign currency amount (in thousands) 661,979 4,242,417 695,550	Exchange rate 28.48 28.48 28.48	Book value (NTD) 18,853,162 $ 120,824,032 19,809,264	Degree of variation 1% 1%	Effect on profit or loss
					188,532 $ 198,093

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December 31, 2019

(Foreign currency: functional currency) Financial assets Monetary items USD：NTD Non-monetary items Foreign operations USD：NTD Financial liabilities Monetary items USD：NTD	Foreign currency amount (in thousands) 452,771 3,980,566 624,622	Exchange rate 29.98 29.98 29.98	Book value (NTD) 13,574,075 $ 119,337,372 18,726,168	Degree of variation 1% 1%	Effect on profit or loss
					135,741 $ 187,262

• v. Total exchange gain (loss), including realized and unrealized, arising from significant foreign exchange variation on the monetary items held by the Company for the years ended December 31, 2020 and 2019 amounted to $409,903 and $83,243, respectively.

Price risk

• i. Nature

The Company primarily invests in domestic listed equity instruments, which are accounted for as financial assets at fair value through other comprehensive income. The price of those equity instruments will be affected by the uncertainty of the future value of the investment.

• ii. Extent

If the price of such equity instrument rises or falls by 1%, with all other factors held constant, the impact on other comprehensive income due to equity instruments measured at fair value through other comprehensive income would have been an increase/decrease of $20,079 and $12,714 for the years ended December 31, 2020 and 2019, respectively.

Cash flow and fair value interest rate risk

The Company’s interest rate risk arises from short-term loans. Short-term loans with floating rates expose the Company to cash flow interest rate risk, but most of the risks are offset by cash and cash equivalents with variable interest rates.

If short-term loans interest rates rise or fall by 1%, with all other factors held constant, profit after tax would decrease/increase by $6,757 and $17,702 for the years ended December 31, 2020 and 2019, respectively.

(b) Credit risk

Credit risk refers to the risk of financial loss to the Company arising from default by the clients or counterparties of financial instruments.

• i. According to the Company’s credit policy, the Company is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. The Company assesses the credit quality of the

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customers by taking into account their financial position, past experience and other factors to conduct its internal risk management.

Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilization of credit limits is regularly monitored. Major credit risk arises from cash and cash equivalents, derivative financial instruments, deposits and short-term investments with banks and financial institutions, and other financial instruments. The counterparties are banks with good credit quality, financial institutions with investment grade credit ratings and government agencies, so there is no significant default concerns and credit risk.

• ii. If the contract payments were past due over 90 days based on the terms, there has been a significant increase in credit risk on that instrument since initial recognition.

• iii. The following indicators are used to determine whether the credit impairment of debt instruments has occurred:

• (i) It becomes probable that the issuer will enter bankruptcy or other financial reorganization due to their financial difficulties;

• (ii) The disappearance of an active market for that financial asset because of financial difficulties;

• (iii) Default or delinquency in interest or principal repayments;

• (iv) Adverse changes in national or regional economic conditions that are expected to cause a default.

• iv. The ageing analysis of accounts receivable (including related parties) is as follows:

Not past due 0 to 90 days 91 to 180 days 181 to 270 days 271 to 360 days Over 361 days	December 31,2020 16,264,630 $ 15,331 - - - - 16,279,961 $	December 31,2019
		11,093,293 $ 199,732 2,175 997 369 - 11,296,566 $

The above ageing analysis was based on past due date.

• v. As of December 31, 2020 and 2019, accounts receivable (including related parties) and notes receivable were all from contracts with customers. As of January 1, 2019, the balance of receivables from contracts with customers amounted to $13,712,843.

• vi. The Company assesses the expected credit losses of accounts receivable (including those from related parties) as follows:

• (i) Accounts receivable are divided into segments according to the Company’s credit rating standards; expected credit losses for each segment are assessed based on the specific loss rate or provision matrix for the segment.

• (ii) Loss rates are calculated based on past and current information, taking into account forward-looking information provided by the Business Indicators Database of the National Development Council and the Basel Committee on Banking Supervision.

• (iii) As of December 31, 2020 and 2019, the loss allowance for accounts receivable (including those from related parties), assessed using loss rate or provision matrix, is as follows:

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December 31,2020 Expected loss rate Total book value Allowance for bad debts December 31,2019 Expected loss rate Total book value Allowance for bad debts	Group1 0.0285% 15,543,058 $ 4,391 $ Group1 0.03% 10,737,245 $ 3,135 $	Group2 0.0285% 320,745 $ 91 $ Group2 0.03% 231,826 $ 70 $	Group3 0.0665% 227,712 $ 151 $ Group3 0.07% 281,915 $ 197 $	Group4 0.0665% 188,446 $ 125 $ Group4 0.07% 45,580 $ 32 $	Total
					16,279,961 $ 4,758 $ Total
					11,296,566 $ 3,434 $

• Group 1: Standard Poor’s, Fitch’s, or Moody’s rating of A-level, or rated as A-level in accordance with the Group’s credit policies for those that have no external credit ratings.

• Group 2: Standard Poor’s or Fitch’s rating of BBB, Moody’s rating of Baa, or rated as B or C in accordance with the Group’s credit policies for those that have no external credit ratings.

• Group 3: Standard Poor’s or Fitch’s rating of BB + and below, or Moody’s rating of Ba1 and below.

• Group 4: Rated as other than A, B, or C in accordance with the Group’s credit policies for those that have no external credit ratings.

• vii. The ageing analysis of accounts receivable (including related parties) that were past due but not impaired is as follows:

At January 1 Provision for impairment At December 31 At January 1 Gain on reversal of expected credit impairment loss ( At December 31	2020 3,434 $ 1,324 4,758 $ 2019 4,092 $ 658) 3,434 $

(c) Liquidity risk

• i. Cash flow forecasting is performed by each of the operating entities of the Company and aggregated by Company treasury. Company treasury monitors rolling forecasts of the Company’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Company does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecasting takes into

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consideration the Company’s debt financing plans, covenant compliance, compliance with internal balance sheet ratio targets and, if applicable external regulatory or legal requirements, for example, currency restrictions.

• ii. The Company’s non-derivative financial liabilities and net-settled or gross-settled derivative financial liabilities are analyzed into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date for nonderivative financial liabilities and to the expected maturity date for derivative financial liabilities.

• iii. Except for lease liabilities listed below, as of December 31, 2020 and 2019, the Company’s non-derivative financial liabilities (including short-term loans, accounts payable and other payables) and derivative financial liabilities (including foreign exchange contracts, cross currency swap contracts and forward foreign exchange contracts) will expire within 1 year.

December 31, 2020 Non-derivative financial liabilities: Lease liability December 31, 2019 Non-derivative financial liabilities: Lease liability	Less than 1year 699 $ Less than 1year 699 $	Between 1 to 2years 641 $ Between 1 to 2years 699 $	Over 2years - $ Over 2years 641 $	Total
				1,340 $ Total
				2,039 $

(3) Fair value information

• A. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

• Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability takes place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Company’s investment in listed stocks is included in Level 1.

• Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The fair value of the Company’s investment in derivative instruments is included in Level 2.

• Level 3: Unobservable inputs for the asset or liability.

• B. Fair value information of investment property at cost is provided in Note 6(11).

• C. The related information on financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities is as follows: (a) The related information on the nature of the assets and liabilities is as follows:

~51~

December 31, 2020		Level 1		Level 2		Level 3		Total
Assets
Recurring fair value measurements
Financial assets at fair value
through profit or loss
Derivative instruments	$	-	$	4,337	$	-	$	4,337
Financial assets at fair value
through other comprehensive
income
Equity instruments	$	2,007,916	$	-	$	-	$	2,007,916
Liabilities
Recurring fair value measurements
Financial liabilities at fair value
through profit or loss
Derivative instruments	$	-	$	214,420	$	-	$	214,420
December 31,2019		Level 1		Level 2		Level 3		Total
Assets
Recurring fair value measurements
Financial assets at fair value
through profit or loss
Derivative instruments	$	-	$	10,946	$	-	$	10,946
Financial assets at fair value
through other comprehensive
income
Equity instruments	$	1,271,373	$	-	$	-	$	1,271,373
Liabilities
Recurring fair value measurements
Financial liabilities at fair value
through profit or loss
Foreign exchange contracts	$	-	$	99,427	$	-	$	99,427

• D. The methods and assumptions the Company used to measure fair value are as follows:

• i. The instruments the Company used market quoted prices as their fair values (that is, Level 1) are listed below by characteristics:

Listed shares

Market quoted price Closing price

• ii. When assessing non-standard and low-complexity financial instruments, for example, debt instruments without active market, interest rate swap contracts, foreign exchange contracts and options, the Company adopts valuation technique that is widely used by market participants. The inputs used in the valuation method to measure these financial instruments are normally observable in the market.

• iii. The valuation of derivative financial instruments is based on valuation model widely accepted by market participants, such as present value techniques and option pricing

~52~

models. Forward exchange contracts are usually valued based on the current forward exchange rate.

• iv. The Company takes into account adjustments for credit risks to measure the fair value of financial and non-financial instruments to reflect credit risk of the counterparty and the Company’s credit quality.

• E. For the years ended December 31, 2020 and 2019, there was no transfer into or out from Level 1 to Level 2.

• F. For the years ended December 31, 2020 and 2019, there was no transfer into or out from Level 3.

13. SUPPLEMENTARY DISCLOSURES

(1) Significant transactions information

• A. Loans to others: Please refer to table 1.

• B. Provision of endorsements and guarantees to others: None.

• C. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to table 2.

• D. Acquisition or sale of the same security with the accumulated cost reaching $300 million or 20% of paid-in capital or more: Please refer to table 3.

• E. Acquisition of real estate reaching $300 million or 20% of paid-in capital or more: None.

• F. Disposal of real estate reaching $300 million or 20% of paid-in capital or more: None.

• G. Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 4.

• H. Receivables from related parties reaching $100 million or 20% of paid-in capital or more: Please refer to table 5.

• I. Trading in derivative instruments undertaken during the reporting periods: Please refer to Notes 6(2), 6(22) and 12(3).

• J. Significant inter-company transactions during the reporting periods: Please refer to table 6.

(2) Information on investees

• Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to table 7.

(3) Information on investments in Mainland China

• A. Basic information: Please refer to table 8.

• B. Significant transactions, either directly or indirectly through a third area, with investee companies in the Mainland Area: Please refer to table 6.

(4) Information on major shareholders

Major shareholders information: Please refer to table 10.

14. SEGMENT INFORMATION

None.

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Foxconn Technology Co., Ltd. Loans to others

Table 1

Year ended December 31, 2020

Expressed in thousands of NTD (Except as otherwise indicated)

No.	Creditor	Borrower	General ledger account	Is a relatedparty	Maximum outstanding balance during the year ended December 31,2020	Balance at December 31,2020	Actual amount drawn down	Interest rate	Nature of loan	Amount of transactions with the borrower	Reason for short-term financing	Allowance for doubtful accounts	Collateral	Collateral	Limit on loans granted to a singleparty	Ceiling on total loansgranted	Note
													Item	Value
1 1 2	Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD.	Qingdao Hiyn Materials Co., Ltd. Fuzhun Precision Industy (Shenyang) Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd.	Other receivables Other receivables Other receivables	Y Y Y	217,960 $ 192,808 607,100	158,538 $ 191,602 569,600	130,865 $ 139,347 569,600	4.35000% 3.91500% 0.49138%	Short-term financing Short-term financing Short-term financing	$ - - -	Business operation Business operation Business operation	$ - - -	Land None None	332,711 $ - -	4,075,034 $ 33,094,649 33,094,649	16,300,135 $ 66,189,298 66,189,298	Note 1 Note 2 Note 2

Note 1: For short-term loans, limit on loans granted for a single party is 10% of the lending company’s net assets and ceiling on total loans is 40% of the Company’s net assets based on the latest audited or reviewed financial statements. Note 2: Limit on loans granted for a single foreign company whose voting rights are 100% owned directly and indirectly by the Company is 30% of the Company’s net assets and 60% for ceiling on total loans. Note 3: Limit on loans granted for a single foreign company whose voting rights are 100% owned directly and indirectly by the Company is 200% of the net assets of the creditor's subsidiary and 400% for ceiling on total loans.

Table 1, Page 1

Foxconn Technology Co., Ltd.

Provision of endorsements and guarantees to others For the year ended December 31, 2020

Number （Note 1） Table 2	Endorser/ guarantor	Party being endorsed/guaranteed	Party being endorsed/guaranteed	Limit on endorsements/ guarantees provided for a single party （Note3）	Maximum outstanding endorsement/ guarantee amount as of December 31, 2020 （Note 4）	Outstanding endorsement/ guarantee amount at December 31, 2020 （Note5）	Actual amount drawn down （Note6）	Amount of endorsements/ guarantees secured with collateral	Ratio of accumulated endorsement/ guarantee amount to net asset value of the endorser/ guarantor company	Ceiling on total amount of endorsements/ guarantees provided （Note3）	Provision of endorsements/ guarantees by parent company to subsidiary （Note 7）	Provision of Provision of endorsements/ endorsements/ guarantees by guarantees to subsidiary to the party in parent Mainland company China （Note 7） （Note 7） Footnote Expressed in thousands of NTD (Except as otherwise indicated)	Provision of Provision of endorsements/ endorsements/ guarantees by guarantees to subsidiary to the party in parent Mainland company China （Note 7） （Note 7） Footnote Expressed in thousands of NTD (Except as otherwise indicated)	Provision of Provision of endorsements/ endorsements/ guarantees by guarantees to subsidiary to the party in parent Mainland company China （Note 7） （Note 7） Footnote Expressed in thousands of NTD (Except as otherwise indicated)
		Companyname	Relationship with the endorser/ guarantor （Note 2）
0 1 2 3	Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Component (Kunshan) Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd.	Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Component (Kunshan) Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd.	1 1 1 1	110,315,497 $ 40,750,340 7,091,657 7,213,963	2,000 $ 18,178 79 21,910	2,000 $ 7,838 78 21,773	2,000 $ 7,838 78 21,773	- $ 7,838 - -	0.00% 0.01% 0.00% 0.02%	110,315,497 $ 40,750,340 7,091,657 7,213,963	N N N N	N N N N	Y Y Y Y	Note 8 Note 9 Note 9 Note 9

Note 1: The numbers filled in for the endorsements/guarantees provided by the Company or subsidiaries are as follows:

(1) The Company is ‘0’.

(2) The subsidiaries are numbered in order starting from ‘1’.

Note 2: Relationship between the endorser/guarantor and the party being endorsed/guaranteed is classified into the following seven categories:

(1) Having business relationship.

(2) The endorser/guarantor parent company owns directly and indirectly more than 50% voting shares of the endorsed/guaranteed subsidiary.

(3) The endorsed/guaranteed company owns directly and indirectly more than 50% voting shares of the endorser/guarantor parent company.

(4) The endorser/guarantor parent company owns directly and indirectly more than 90% voting shares of the endorsed/guaranteed company.

(5) Mutual guarantee of the trade made by the endorsed/guaranteed company or joint contractor as required under the construction contract.

(6) Due to joint venture, all shareholders provide endorsements/guarantees to the endorsed/guaranteed company in proportion to its ownership.

(7) Joint guarantee of the performance guarantee for pre-sold home sales contract as required under the Consumer Protection Act.

Note 3: Ceiling on total endorsements/guarantees granted by the Company is 100% of the Company's net assets and the limit on endorsements/guarantees provided for a single party is 50% of the Company's net assets; limit on total endorsements/g granted by the Company and its subsidiaries is 100% of the Company and its subsidiaries' net assets, the limit on endorsements/guarantees provided for a single party is 50% of the Company's net assets; limit on total guarantees related to granted by and for the Company and its subsidiaries is 100% of the Company and its subsdiaries' net assets, and limit on guarantees provided for a single party is 100% of its subsidiaries. Note 4: Maximum outstanding balance of endorsements/guarantees provided as of the reporting period. Note 5: Fill in the amount approved by the Board of Directors or the chariman if the chairman has been authorised by the Board of Directors based on subparagraph 8, Article 12 of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies.

Note 6: Fill in the actual amount of endorsements/guarantees used by the endorsed/guaranteed company.

Note 7: Fill in ‘Y’ for those cases of provision of endorsements/guarantees by listed parent company to subsidiary and provision by subsidiary to listed parent company, and provision to the party in Mainland China. Note 8: The Company provided tax-related guarantees for itself.

Note 9: The Company and its subsidiaries provided tax-related guarantees for themselves.

Table 2, Page 1

Foxconn Technology Co., Ltd. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) Year ended December 31, 2020

Table 3

Expressed in thousands of NTD (Except as otherwise indicated)

Securities held by	Marketable securities	Relationship with the securities issuer	General ledger account		As of December31,2020	As of December31,2020		Note
				Number of shares	Bookvalue	Ownership (%)	Fairvalue
Foxconn Technology Co., Ltd. 〞 〞 〞 Huazhun Investment Co., Ltd. 〞 Q-Run Holdings Ltd. 〞 〞 Foxconn Technology Pte. Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd 〞 Fuzhun Precision (Shenzhen) Industry Co., Ltd.	Common stock of CyberTAN Technology Inc. Common stock of Pan-International Industrial Corp. Common stock of Innolux Corporation Common stock of Advanced Optoelectronic Technology, Inc. Common stock of Innolux Corporation Common stock of Advanced Optoelectronic Technology, Inc. Common stock of China Harmony Auto Holding Ltd. Common stock of FE Holdings USA, Inc. Preferred stock of VIZIO Inc. Common stock of Sharp Corporation Jinan Fujie Industrial Investment Fund Partnership (limited partnership) Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust	None 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞	Financial assets at fair value through other comprehensive income - non-current 〞 〞 〞 〞 〞 〞 〞 〞 〞 Financial assets at fair value through profit or loss - non-current Financial assets at amortized cost - non-current 〞 〞	10,035,348 1,079,986 127,556,349 1,000 121,036,800 7,672,000 38,452,340 8,040 67,368 64,640,000 - - - -	181,640 $ 27,701 1,798,545 30 1,706,619 232,462 520,969 2,134,544 2,069,964 27,928,642 524,752 217,730 2,177,300 217,730	3.05 0.21 1.31 0 1.25 5.31 2.44 11.93 Note 1 12.14 9.09 - - -	181,640 $ 27,701 1,798,545 30 1,706,619 232,462 520,969 2,134,544 2,069,964 27,928,642 524,752 217,730 2,177,300 217,730

Note 1: As of December 31, 2020, the Company owns 67,368 shares of preferred stock in VIZIO Inc., with an ownership interest of 50% in the preferred stock, but no voting rights.

Table 3, Page 1

Table 4

Foxconn Technology Co., Ltd.

Aggregate purchases or sale of the same securities reaching $300 million or 20% of paid-in capital or more

Year ended December 31, 2020

Expressed in thousands of NTD

(Except as otherwise indicated)

Investor	Marketable securities	General ledger account	Counterparty (Note 4)	Relationship with the investor (Note 4)	Balance as at January1,2020	Balance as at January1,2020	Addition	Addition		Disposal	Disposal		Balance as at December 31,2020	Balance as at December 31,2020
					Number of shares (In thousands)	Amount	Number of shares (In thousands)	Amount	Number of shares	Selling price	Book value	Gain (loss) on disposal	Number of shares	Amount
Fuzhun Precision (Shenzhen) Industry Co., Ltd. Fuzhun Precision (Shenzhen) Industry Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Nanning Funing Precision Electronics Ltd. Nanning Funing Precision Electronics Ltd. Nanning Funing Precision Electronics Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd	Shanghai Commercial & Savings Bank “Winner” Currency and Bond Series (Drip into Gold) Financial product (WG19011S) Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust Fortune Shuttle No. 1 BOC Principal Guaranteed Open- end RMB Wealth Management Product BOC Principal Guaranteed Open- end RMB Wealth Management Product BOC Principal Guaranteed Open- end RMB Wealth Management Product Open-end RMB Wealth Management Product Open-end RMB Wealth Management Product Open-end RMB Wealth Management Product Bank of Beijing for RMB public structured deposits - 14 Bank of Beijing for RMB public structured deposits - 15 Bank of Beijing for RMB public structured deposits - 16 Bank of Beijing for RMB public structured deposits - 17	Note 1 Note 2 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	The Shanghai Commercial & Savings Bank Guangdong Yuecai Intrust & Investment Company Shanghai Pudong Development Bank Bank of China Bank of China Bank of China Bank of China Bank of China Bank of China Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing	〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞	- - - - - - - - - - - - -	RMB 150,000 thousand RMB 200,000 thousand RMB 700,000 thousand - - - - - - RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand	- - - - - - - - - - - - -	- - - RMB 650,000 thousand RMB 700,000 thousand RMB 600,000 thousand RMB 200,000 thousand RMB 200,000 thousand RMB 200,000 thousand - - - -	- - - - - - - - - - - - -	RMB 150,888 thousand RMB 161,832 thousand RMB 701,755 thousand RMB 653,793 thousand RMB 702,723 thousand RMB 605,149 thousand RMB 201,880 thousand RMB 201,184 thousand RMB 201,070 thousand RMB 505,362 thousand RMB 505,414 thousand RMB 504,841 thousand RMB 506,431 thousand	RMB 150,000 thousand RMB 150,000 thousand RMB 700,000 thousand RMB 650,000 thousand RMB 700,000 thousand RMB 600,000 thousand RMB 200,000 thousand RMB 200,000 thousand RMB 200,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand	RMB 888 thousand RMB 11,832 thousand RMB 1,755 thousand RMB 3,793 thousand RMB 2,723 thousand RMB 5,149 thousand RMB 1,880 thousand RMB 1,184 thousand RMB 1,070 thousand RMB 5,362 thousand RMB 5,414 thousand RMB 4,841 thousand RMB 6,431 thousand	- - - - - - - - - - - - -	- RMB 50,000 thousand - - - - - - - - - - -

Table 4, Page 1

Investor	Marketable securities	General ledger account	Counterparty (Note 4)	Relationship with the investor (Note 4)	Balance as at January1,2020	Balance as at January1,2020	Addition	Addition		Disposal	Disposal		Balance as at December 31,2020	Balance as at December 31,2020
					Number of shares (In thousands)	Amount	Number of shares (In thousands)	Amount	Number of shares	Selling price	Book value	Gain (loss) on disposal	Number of shares	Amount
Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd	Bank of Beijing for RMB public structured deposits - 18 Bank of Beijing for RMB public structured deposits - 19 Bank of Beijing for RMB public structured deposits - 21 Bank of Beijing for RMB public structured deposits - 22 Bank of Beijing for RMB public structured deposits - 23 Bank of Beijing for RMB public structured deposits - 24 Bank of Beijing for RMB public structured deposits - 25 Bank of Beijing for RMB public structured deposits - 26 Bank of Beijing for RMB public structured deposits - 27 Bank of Beijing for RMB public structured deposits - 28 Bank of Beijing for RMB public structured deposits - 29 Bank of Beijing for RMB public structured deposits - 31 Bank of Beijing for RMB public structured deposits - 32 Bank of Beijing for RMB public structured deposits - 33 Bank of Beijing for RMB public structured deposits - 34 Bank of Beijing for RMB public structured deposits - 35	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing Bank of Beijing	〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞	- - - - - - - - - - - - - - - -	RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand - - - - - - - - - - - - -	- - - - - - - - - - - - - - - -	- - - RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 200,000 thousand RMB 300,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand	- - - - - - - - - - - - - - - -	RMB 506,378 thousand RMB 506,219 thousand RMB 504,685 thousand RMB 504,774 thousand RMB 504,774 thousand RMB 504,685 thousand RMB 504,685 thousand RMB 504,737 thousand RMB 504,685 thousand RMB 504,789 thousand RMB 504,537 thousand RMB 201,764 thousand RMB 302,877 thousand RMB 504,611 thousand RMB 504,658 thousand RMB 504,844 thousand	RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 200,000 thousand RMB 300,000 thousand RMB 500,000 thousand RMB 500,000 thousand RMB 500,000 thousand	RMB 6,378 thousand RMB 6,219 thousand RMB 4,685 thousand RMB 4,774 thousand RMB 4,774 thousand RMB 4,685 thousand RMB 4,685 thousand RMB 4,737 thousand RMB 4,685 thousand RMB 4,789 thousand RMB 4,537 thousand RMB 1,764 thousand RMB 2,877 thousand RMB 4,611 thousand RMB 4,658 thousand RMB 4,844 thousand	- - - - - - - - - - - - - - - -	- - - - - - - - - - - - - - - -

Table 4, Page 2

Investor	Marketable securities	General ledger account	Counterparty (Note 4)	Relationship with the investor (Note 4)	Balance as at January1,2020	Balance as at January1,2020	Addition	Addition		Disposal	Disposal		Balance as at December 31,2020	Balance as at December 31,2020
					Number of shares (In thousands)	Amount	Number of shares (In thousands)	Amount	Number of shares	Selling price	Book value	Gain (loss) on disposal	Number of shares	Amount
Hon Fujin Precision Industry (Taiyuan) Co., Ltd Hon Fujin Precision Industry (Taiyuan) Co., Ltd	Bank of Beijing for RMB public structured deposits - 36 Guangdong Finance Trust - Peng Yun Tian Hua Collection Fund Trust	Note 1 Note 1	Bank of Beijing Guangdong Yuecai Intrust & Investment Company	〞 〞	- -	- RMB 700,000 thousand	- -	RMB 500,000 thousand -	- -	RMB 504,611 thousand RMB 191,413 thousand	RMB 500,000 thousand RMB 150,000 thousand	RMB 4,611 thousand RMB 41,413 thousand	- -	- RMB 550,000 thousand

Note 1 ： Recorded in “financial assets at amortized cost-current”.

Note 2 ： Recorded in “financial assets at amortized cost-non-current”. Note 3 ： Fill in the columns the counterparty and relationship if securities are accounted for under the equity method; otherwise leave the columns blank.

Table 4, Page 3

Foxconn Technology Co., Ltd.

Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more Year ended December 31, 2020

Table 5

Expressed in thousands of NTD (Except as otherwise indicated)

									(Except as otherwise	(Except as otherwise	indicated)
Purchaser/seller	Counterparty	Relationship withthe counterparty		Transaction			Differences in transaction terms compared to third party transactions		Notes/accountsreceivable (payable)		Note
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unit price	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. FTC TECHNOLOGY INC. Fuzhun Precision (Shenzhen) Industry Co., Ltd.	Foxconn (Far East) Ltd. and subsidiaries Champ Tech Optical (Foshan) Corporation FTC Technology Inc. Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries Hon Fujin Precision Industry (Taiyuan) Co., Ltd. SHARP CORPORATION and subsidiaries Foxconn (Far East) Ltd. and subsidiaries Champ Tech Optical (Foshan) Corporation	The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. The investee is an indirect subsidiary of the Company The investee is an indirect subsidiary of the Company The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The investee is an indirect subsidiary of the Company Other related parties The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries	Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales Sales	730,418 $ 228,922 188,871 12,709,659 711,219 288,214 3,771,586 1,320,939 161,072 2,244,026 3,138,469 246,449 151,241 117,142	1 - - 89 5 7 92 77 9 20 29 2 60 91	90 days 90 days 90 days 90 days 90 days 90 days 60 days 90 days 90 days 90 days 90 days 60 days 90 days 90 days	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	363,568 $ 89,709 29,229 8,966,295 197,483 218,450 1,199,416 411,759 - 853,881 1,377,188 55,004 46,185 -	2 1 - 96 2 15 83 77 - 26 41 2 47 -	Note 2

Table 5, Page 1

Differences in transaction

							Differences in transaction	Differences in transaction
Purchaser/seller	Counterparty	Relationship withthe counterparty		Transaction			terms compared to third party transactions		Notes/accountsreceivable (payable)		Note
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unit price	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
Nanning Funing Precision Electronics Co., Ltd. YanTai Fuzhun Precision Electronics YanTai Fuzhun Precision Electronics Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD.	FOXCONN TECHNOLOGY PTE LTD. Foxconn (Far East) Ltd. and subsidiaries Fu Yu Precision Components (Kunshan) Co., Ltd. Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries Nanning Funing Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation Fuzhun Precision (Hebi) Electronics Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd. INNOLUX CORPORATION GENERAL INTERFACE SOLUTION (GIS) HOLDING LIMITED SHARP CORPORATION Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries	The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision The counterparties of the investee are indirect subsidiaries of the Company and its The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. The investee is an indirect subsidiary of the Company The investee is an indirect subsidiary of the Company The investee is an indirect subsidiary of the Company The investee is an indirect subsidiary of the Company Other related parties Other related parties Other related parties The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries	Sales Sales Sales Sales Sales Purchases Purchases Purchases Purchases Purchases Purchases Purchases Purchases Purchases Purchases Purchases	131,533 $ 166,919 232,982 510,512 3,040,535 64,620,124 1,975,678 2,050,556 175,074 291,507 2,022,343 179,517 3,208,674 3,268,043 401,445 1,014,928	5 15 22 7 40 85 3 3 - - 3 - 4 24 12 9	90 days 90 days 90 days 90 days 90 days 90 days 30 days 90 days 90 days 90 days 60 days 60 days 60 days 90 days 90 days 90 days	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1 Note 1	28,594 $ 75,364 87,167 262,089 572,373 14,258,282) ( 394,758) ( 522,134) ( 105,931) ( 74,667) ( 210,609) ( - 509,967) ( 5,815,247) ( 164,144) ( 187,266) (	5 27 32 11 23 77) ( 2) ( 3) ( 1) ( - 1) ( - 3) ( 75) ( 16) ( 6) (

Table 5, Page 2

Purchaser/seller	Counterparty	Relationship withthe counterparty		Transaction	Transaction		Differences in transaction terms compared to third party transactions	Differences in transaction terms compared to third party transactions	Notes/accountsreceivable (payable)	Notes/accountsreceivable (payable)	Note
			Purchases (sales)	Amount	Percentage of total purchases (sales)	Credit term	Unit price	Credit term	Balance	Percentage of total notes/accounts receivable (payable)
FOXCONN TECHNOLOGY PTE. LTD. Hon Hai Precision Industry Co., Ltd. The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries Purchases 774,164 $ 7 Champ Tech Optical (Foshan) Corporation Foxconn (Far East) Ltd. and subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries Purchases 242,296 4 Champ Tech Optical (Foshan) Corporation Pan-International Industrial Corp. and subsidiaries Other related parties Purchases 418,370 6 Note 1: Except for circumstances in which there are no similar transactions for reference and the prices and credit periods are negotiated by both parties, the aforementioned related party is offered prices very close to those offered to other customers and given a payment period of 30 to 90 days.						90 days 90 days 90 days	Note 1 Note 1 Note 1	Note 1 Note 1 Note 1	302,734) ($ 41,205) ( 128,900) (	9) ( 2) ( 6) (

Note 2: For transactions involving the sale of raw materials to the aforementioned related party and subsequent repurchase of goods made from the same raw materials from the same party, the initial sale of raw materials is eliminated due to economic substance.

Table 5, Page 3

Foxconn Technology Co., Ltd.

Receivables from related parties reaching $100 million or 20% of paid-in capital or more

December 31, 2020

			December 31, 2020
Table 6 Creditor	Counterparty	Relationshipwith the counterparty	Balance as at December 31,2020	Turnover rate	Overdue receivables		Amount collected subsequent to the balance sheet date Expressed (Except as	in thousands of NTD otherwise indicated) Allowance for doubtful accounts
					Amount	Action taken
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. FOXCONN TECHNOLOGY PTE. LTD. Nanning Funing Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation	Foxconn (Far East) Ltd. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries SHARP CORPORATION and subsidiaries Pan-International Industrial Corp. and subsidiaries Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries FOXCONN TECHNOLOGY PTE. LTD. Foxconn (Far East) Ltd. and subsidiaries Foxconn Technology Co., Ltd. Foxconn (Far East) Ltd. and subsidiaries Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Foxconn Technology Co., Ltd. Foxconn (Far East) Ltd. and subsidiaries	The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. The indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. Other related parties Other related parties The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The Company’s ultimate parent company The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries The Company’s ultimate parent company The counterparties of the investee are indirect subsidiaries of Hon Hai Precision Industry Co., Ltd. and its subsidiaries	363,568 $ 1,394,124 (shown as other receivables)(Note 1) 101,120 (shown as other receivables)(Note 1) 771,723 (shown as other receivables)(Note 1) 8,966,295 197,483 218,450 1,199,416 411,759 105,931 853,881 1,377,188 394,758 262,089	1 .74 Not applicable Not applicable Not applicable 1 .14 3.54 1.97 3.96 2.48 1.86 2.84 1.97 6.71 2.10	5,712 $ - - - 3,869,051 - 49,436 73,683 152,436 21,767 28,262 100,559 4,769 39,773	Subsequent collection - - - Subsequent collection - Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection Subsequent collection	5,712 $ - - - 3,869,051 - 49,436 73,683 152,436 21,767 28,262 100,559 4,769 17,023	- $ - - - - - - - - - - - - -

Table 6, Page 1

Creditor	Counterparty	Relationshipwith the counterparty	Balance as at December 31,2020	Turnover rate	Overdue receivables	Overdue receivables	Amount collected subsequent to the balance sheet date	Allowance for doubtful accounts
					Amount	Action taken
Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation	Foxconn Technology Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD.	The Company’s ultimate parent company The counterparties of the investee are indirect subsidiaries of the Company and its subsidiaries	522,134 $ 572,373	4.40 5.47	- $ -	- -	- $ -	- $ -

Note 1: Receivables from purchases of materials by investees on behalf of the ultimate parent company.

Table 6, Page 2

Foxconn Technology Co., Ltd.

Significant inter-company transactions during the reporting period

Table 7

Year ended December 31, 2020

Expressed in thousands of NTD (Except as otherwise indicated)

Transaction

Number (Note 1)	Companyname	Counterparty	Relationship (Note 2)	General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets
0 0 0 0 0 0 1 1 2 2 3 3 4 5 5 5 6 6 7 7 8	Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. 〝 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. 〝 Fu Yu Precision Components (Kunshan) Co., Ltd. 〝 FOXCONN TECHNOLOGY PTE. LTD. 〝 YanTai Fuzhun Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation Champ Tech Optical (Foshan) Corporation 〝 Nanning Funing Precision Electronics Co., Ltd. Nanning Funing Precision Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. Fuzhun Precision (Shenzhen) Industry Co., Ltd.	Nanning Funing Precision Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd. FTC Technology Inc. YanTai Fuzhun Precision Electronics Co., Ltd. Champ Tech Optical (Foshan) Corporation 〝 FOXCONN TECHNOLOGY PTE. LTD. 〝 FOXCONN TECHNOLOGY PTE. LTD. 〝 Hon Fujin Precision Industry (Taiyuan) Co., Ltd. 〝 Fu Yu Precision Components (Kunshan) Co., Ltd. Foxconn Technology Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. 〝 FOXCONN TECHNOLOGY PTE. LTD. Foxconn Technology Co., Ltd. FOXCONN TECHNOLOGY PTE. LTD. Foxconn Technology Co., Ltd. Champ Tech Optical (Foshan) Corporation	1 1 1 1 1 1 3 3 3 3 3 3 3 2 3 3 2 3 2 3	Purchases Purchases Sales Purchases Purchases Sales Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales Accounts receivable Sales	1,975,678 $ 175,074 188,871 291,507 2,050,556 228,922 711,219 197,483 3,771,586 1,199,416 3,138,469 1,377,188 232,982 522,134 3,040,535 572,373 131,533 394,758 161,072 105,931 117,142	Note 4 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞	2 - - - 2 - 1 - 4 1 2 1 - - 3 - - - - -

Note 1: The information of transactions between the Company and the subsidiaries should be noted in “Number” column.

Note 2: (1) Number 0 represents the Company.

Note 2: (2) The consolidated subsidiaries are numbered in order from number 1.

Note 2: The transaction relationship with counterparties are as follows:

Note 2: (1) The Company to the consolidated subsidiary.

Note 2: (2) The consolidated subsidiaries to the Company.

Note 2: (3) The consolidated subsidiaries to other consolidated subsidiaries.

Note 3: Disclosure standard of transactions between the Company and subsidiaries is when purchases, sales and receivables (payables) from (to) related parties account for at least $100,000 or 20% of capital. Relative related are not disclosed. Note 4: Except for circumstances in which there are no similar transactions for reference and the prices and credit periods are negotiated by both parties, the aforementioned related party is offered prices very close to those offered to other customers and given a payment period of 30 to 90 days.

Note 5: In calculating the ratio, the transaction amount is divided by consolidated total assets for balance sheet accounts and is divided by consolidated total revenues for income statement accounts. Note 6: For information of loans to others, please refer to table 1.

Table 7, Page 1

Foxconn Technology Co., Ltd.

Information on investees

Year ended December 31, 2020

				Year ended December 31, 2020	Year ended December 31, 2020
Table 8 Investor	Investee	Location	Mainbusiness activities	Initial investment amount		Sharesheld as atDecember		31,2020	Net profit (loss) of the investee for the year ended December31,2020	Expressed in thousands of NTD (Except as otherwise indicated) Investment income (loss) recognised by the Company for the year ended December31,2020 Note
				Balance as at December31,2020	Balance as at December31,2019	Numberofshares	Ownership (%)	Bookvalue
Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd. Foxconn Technology Co., Ltd.	Q-Run Holdings Ltd. Foxconn Precision Components Holding Co., Ltd. Huazhun Investment Co., Ltd. Syntrend Creative Park Co., Ltd.	Cayman Islands Cayman Islands Taiwan Taiwan	Investment holding Investment holding Investment Retail of office machinery and equipment and electronic appliances, and information software services	9,851,192 $ 492,742 1,254,780 490,322	9,851,192 $ 492,742 1,254,780 490,322	480,077,600 135,839,643 125,478,000 49,032,250	100 100 100 20	104,857,153 $ 15,966,879 1,995,846 277,578	1,987,983 $ 533,232 12,150 18,887) (	1,956,152 $ 533,232 12,150 3,772) (

Note: Besides Foxconn Precision Components Holding Co., Ltd., Q-Run Holdings Ltd. and Huazhun Investment Co., Ltd. are subsidiaries of the Company, Atkinson Holdings Ltd., Q-Run Far East Corporation, World Trade Trading Ltd., High Tempo International Ltd., FTC Technology Inc., Foxconn Technology Pte. Ltd., Kenny International Ltd., Double Wealth Profits Ltd., Precious Star International Ltd., Eastern Star Limited., Foreign Technology Ltd., Topfry Industrial Ltd., Gold Glory International Ltd., New Glory Holdings Ltd., FTP Technology Inc., Fu Rui Precision Components (Kunshan) Co., Ltd., Fuzhun Precision (Shenzhen) Industry Co., Ltd., Fuyu Technology (Nanyang) Co., Ltd., Champ Tech Optical (Foshan) Corporation, Hon Fujin Precision Industry (Taiyuan) Co., Ltd., Fuzhun Precision (Hebi) Electronics Co., Ltd., Qingdao Hiyn Materials Co., Ltd., Fuhuigang Industrial (Shenzhen) Co., Ltd., Fu Yu Precision Components (Kunshan) Co., Ltd., YanTai Fuzhun Precision Electronics Co., Ltd., Nanning Funing Precision Electronics Co., Ltd. and Fuzhun Precision (Shenyang) Industry Co., Ltd. are subsidiaries of the Company as well.

Table 8, Page 1

Foxconn Technology Co., Ltd.

Information on investees in Mainland China

Table 9

Year ended December 31, 2020

Expressed in thousands of NTD (Except as otherwise indicated)

Investee in Mainland China	Main business activities	Paid-in capital	Investment method (Note 1)	Accumulated amount of remittance from Taiwan to Mainland China as of January1,2020	Amount remitted from Taiwan to Mainland China / Amount remitted back to Taiwan for the year ended December 31,2020	Amount remitted from Taiwan to Mainland China / Amount remitted back to Taiwan for the year ended December 31,2020	Accumulated amount of remittance from Taiwan to Mainland China as of December 31,2020	Net income of investee for the year ended December 31,2020	Ownership held by the Company (direct or indirect)	Investment income (loss) recognised by the Company for the year ended December 31, 2020 (Note 2)	Book value of investments in Mainland China as of December 31,2020	Accumulated amount of investment income remitted back to Taiwan as of December 31,2020	Note
					Remitted to Mainland China	Remitted back to Taiwan
Fuhuigang Industrial (Shenzhen) Co., Ltd. Fu Yu Precision Components (Kunshan) Co., Ltd. Fuzhun Precision (Shenzhen) Industry Co., Ltd. Fu Rui Precision Components (Kunshan) Co., Ltd. Hon Fujin Precision Industry (Taiyuan) Co., Ltd. Nanning Funing Precision Electronics Co., Ltd. YanTai Fuzhun Precision Electronics Co., Ltd. Fuzhun Precision (Hebi) Electronics Co., Ltd.	Computer case – electronic and electrical components Manufacturing and marketing of power plug and wall socket, micro ribbon connectors for terminals, etc. Manufacturing and marketing of computer components (computer thermal module) Electrical board components processing; manufacturing and marketing of optoelectronics and computer cables Manufacturing and marketing of computer components and related peripherals, computer cases and metal stamping Manufacturing and marketing of computer components (computer thermal module) Manufacturing and marketing of computer case - electronic and electrical components New alloy material, precision molds, new electronic components, portable computers and their components	220,919 $ 1,115,676 555,360 350,048 11,676,800 279,104 1,124,960 4,206,496	2 2 2 2 2 2 2 2	220,919 $ 560,657 56,960 224,536 3,972,960 - 1,124,960 1,415,456	- $ - - - - - - -	- $ - - - - - - -	220,919 $ 560,657 56,960 224,536 3,972,960 - 1,124,960 1,415,456	25,461 $ 530,177 343,319 - 528,516 342,088 3,725) ( 213,896	100 100 100 100 100 100 100 100	25,461 $ 530,177 343,319 - 528,516 342,088 3,725) ( 213,896	463,312 $ 7,091,657 5,308,174 - 40,750,340 3,152,682 642,938 7,213,963	- $ - - - - - - -

Table 9, Page 1

Accumulated amount of Investment amount approved Ceiling on investments in remittance from Taiwan to by the Investment Commission Mainland China imposed by Mainland China as of of the Ministry of Economic the Investment Commission Company name December 31, 2020 Affairs (MOEA) of MOEA (Note 3) Foxconn Technology Co., Ltd. $ 7,576,448 $ 20,313,816 $ -

• Note 1: Investment methods are classified into the following three categories:

• (1) Directly invest in a company in Mainland China.

• (2) Through investing in Q-Run Holdings Ltd. or Foxconn Precision Components Holding Co., Ltd., which then invested in Mainland China.

• (3) Others.

• Note 2: Except for Hon Fujin Precision Industry (Taiyuan) Co., Ltd., the investment income (loss) recognised by all other investees in Mainland China for the year ended December 31, 2020 were not audited or attested by R.O.C. parent company's CPA.

• Note 3: Pursuant to the amended ‘Guidelines Governing the Review of Investment or Technical Cooperation in the Mainland Area’ dated on August 29, 2008, as the Company has obtained the certificate of being qualified

• for operating headquarters, issued by the Industrial Development Bureau, MOEA, the ceiling amount of the investment in Mainland China is not applicable to the Company from May 31, 2018 to May 30, 2021.

• Note 4: The Company needs no approval by Investment Commission of the Ministry of Economic Affairs for investment in Qingdao Hiyn Materials Co., Ltd., Fuzhun Precision (Shenyang) Industry Co., Ltd., Fuyu Technology

• (Nanyang) Co., Ltd. and Champ Tech Optical (Foshan) Corporation which were reinvested through an existing company in Mainland China.

• Note 5: The Company’s subsidiary, Fu Yu Precision Components (Kunshan) Co., Ltd., merged with the subsidiary, Fu Rui Precision Components (Kunshan) Co., Ltd, with the effective date set on December 31, 2018. As of December 31, 2020, the merger is still in process.

Table 9, Page 2

Table 10

Foxconn Technology Co., Ltd.

Major shareholders information

December 31, 2020

Name of major shareholders	Shares held as at December31,2020	Shares held as at December31,2020
	Number of shares	Ownership (%)
Hon Hai Precision Industry Co., Ltd. Bao Xin International Investment Co., Ltd. Hung Yang Venture Investment Co., Ltd.	139,725,801 126,181,274 85,003,766	9.87 8.92 6.00

Table 10, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF CASH AND CASH EQUIVALENTS DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 1

Items Cash in banks Check deposits Demand deposits Foreign deposits USD 71,173 In thousands Exchange rate 28.48 JPY 114,363 In thousands Exchange rate 0.2800 EUR 207 In thousands Exchange rate 35.02 HKD 1,175 In thousands Exchange rate 3.6700 SGD 25 In thousands Exchange rate 21.56 RMB 607 In thousands Exchange rate 4.3500 Description	Amount
	2,532 $ 265,909 2,027,010 31,598 7,245 4,317 535 2,645
	2,341,791 $

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Summary 1, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF ACCOUNTS RECEIVABLE DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 2

Items	Description			Amount	Remark
PKM CORPORATION			$	14,708,497
					Balance of individual
					customers is under 5% of
Others				992,333	this account's balance.
				15,700,830
Less: Allowance for bad debts		(		4,645)
			$	15,696,185
Accounts receivable from related parties
Hongfujin Precision Electroncis (Yantai) Co., Ltd.			$	168,040
Hongfujin Precision Electroncis (Wuhan) Co., Ltd.				91,147
Champ Tech Optical (Foshan) Corporation				89,709
Shenzhen Fugui Precision Industry Co., Ltd.				42,543
Nanning Funing Precision Electronics Co., Ltd.				31,536
High Tempo International Ltd. - B.V.I				30,382
FTC Technology Inc.				29,229
					Balance of individual
					customers is under 5% of
Others				96,545	this account's balance.
				579,131
Less: Allowance for bad debts		(		113)
			$	579,018

Summary 2, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF INVENTORY FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 3

Summary 3
Items Finished goods Inventory in transit Less: Provision for inventory valuation losses	Summary
		Cost 2,085,876 $ 352,982 2,438,858 15,729) ( 2,423,129 $

Summary 3, Page 1

FOXCONN TECHNOLOGY CO., LTD. MOVEMENT SUMMARY OF INVESTMENTS ACCOUNTED FOR UNDER THE EQUITY METHOD FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 4

Companyname	In thousand shares Amount 480,078 103,757,140 $ 135,840 15,580,232 125,478 1,197,817 49,032 281,350 120,816,539 $ As of January1,2020	In thousand shares Amount - 4,093,525 $ - 535,298 - 804,898 - - 5,433,721 $ Additions(Note 1)	In thousand shares Amount - 2,993,512) ($ - 148,651) ( - 6,869) ( - 3,772) ( 3,152,804) ($ Deductions(Note 2)	As	Ownership (%) Amount 100 104,857,153 $ 100 15,966,879 100 1,995,846 20 277,578 123,097,456 $ of December 31,2020	Market value or net	equiryvalue	Pledged as collateral
	In thousand shares 480,078 135,840 125,478 49,032	In thousand shares - - - -		In thousand shares 480,078 135,840 125,478 49,032	Ownership (%) 100 100 100 20	Totalprice 104,959,596 $ 15,966,879 1,995,846 245,703 123,168,024 $	Valuation basis Equity method 〃 〃 〃
Q-RUN HOLDINGS LTD. FOXCONN PRECISION CONPONENTS HOLDING CO., LTD. HUAZHUN INVESTMENT CO., LTD. SYNTREND CREATIVE PARK CO., LTD.								None 〃 〃 〃

Note 1: Additions include investment income accounted for using equity method, change in capital surplus and recognition of valuation adjustment for FVTOCI financial assets gain on investees' financial instruments. Note 2: Deductions include investment loss accounted for using equity method, cash dividends received, change in capital surplus, recognition of valuation adjustment for FVTOCI financial assets loss on investees' financial instruments and exchange differences on translation of foreign financial statements.

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Summary 4, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF SHORT-TERM LOANS DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 5

Summary 5
Items Unsecured bank loans 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞	Bank Amount Standard Chartered Bank (Taiwan) Ltd. 996,800 $ Bank of America Taipei Branch 1,139,200 Citibank Taiwan Ltd. Taipei Branch 1,993,800 HSBC Bank (Taiwan) Limited 1,165,000 The Bank of Tokyo-Mitsubishi, Ltd. 2,848,000 Mizuho Bank Taipei Branch 1,086,000 China Construction Bank Taipei Branch 1,050,000 DBS Bank (Taiwan) Ltd. 1,139,200 Crédit Agricole Corporate and 1,000,000 Investment Bank Taipei Fubon Commercial Bank Co., Ltd 1,500,000 E.Sun Bank (East Sanchung Branch) 600,000 14,518,000 $	Term of Contract 2020/12/11~2021/1/04 2020/12/23~2021/1/22 2020/12/09~2021/1/15 2020/12/31~2021/1/29 2020/12/28~2021/1/28 2020/10/29~2021/3/29 2020/12/18~2021/1/15 2020/12/04~2021/1/04 2020/10/29~2021/4/29 2020/11/13~2021/1/13 2020/12/28~2021/1/28	Rate 0.50% 0.57% 0.48% 0.65% 0.55% 0.55% 0.51% 0.48% 0.80% 0.50% 0.77%	Financing amount (In thousands) USD 60,000 USD 40,000 USD 113,000 USD 140,000 USD 100,000 USD 150,000 USD 200,000 USD 100,000 USD 250,000 NTD 1,500,000 NTD 3,000,000	Collateral None 〞 〞 〞 〞 〞 〞 〞 〞 〞 〞	Footnote

Summary 5, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF ACCOUNTS PAYABLE FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 6

Vendor Name Accounts payable Company A Company W Company G Others Accounts payable to related parties Hongfujin Precision Electroncis (Yantai) Co., Ltd. Others	Description	Amount Notes 1,768,306 $ 263,442 193,609 127,535 Balance of individual vendor is under 5% of this account's balance. 2,352,892 $ 14,223,941 $ 1,862,827 Balance of individual vendor is under 5% of this account's balance. 16,086,768 $	Notes

Summary 6, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF OPERATING REVENUE FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 7

Items Electronic products Others Less: Sales returns and discounts	Quantity (in thousands) Amount Note 80,942,966 $ 153,717 81,096,683 2,806,117) ( 78,290,566 $	Remark

Note: The number of products sold is varied and the units of pricing are different, so the quantity is not listed.

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Summary 7, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF OPERATING COSTS FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 8
	Items		Amount
Beginning raw materials		$	-
Add: Incoming inventory			-
Less: Ending raw materials			-
Material consumption			-
Manufacturing expenses			-
Manufacturing costs			-
Add: Beginning work in process			-
Incoming inventory			-
Cost of finished goods			-
Add: Beginning finished goods			438,042
Acquisition of finished goods			76,218,234
Less: Ending finished goods		(	2,438,858)
Other operating costs			200,998
		$	74,418,416

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Summary 8, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF OTHER OPERATING COSTS FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 9

Items Wages and salaries Labor and health insurance Pension Processing fee Others	Description	Amount Remark 135,287 $ 5,227 3,106 3,586 53,792 Balance of individual accounts is under 5% of this account's balance. 200,998 $	Remark

Summary 9, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF SELLING EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 10

Items Wages and salaries Freight Storage Pension Others	Description	Amount Remark 120,958 $ 33,100 3,646 2,106 53,759 Balance of individual accounts is under 5% of this account's balance. 213,569 $	Remark

Summary 10, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF GENERAL AND ADMINISTRATIVE EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 11 Items Description Amount Remark Wages and salaries $ 156,634 Other professional service expenses 8,197 Pension 3,101 Balance of individual accounts is under 5% of this account's Others 79,280 balance. $ 247,212

Summary 11, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF RESEARCH AND DEVELOPMENT EXPENSES FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 12 Items Wages and salaries Labor and health insurance Pension Others	Description	Amount Remark 303,968 $ 9,347 4,690 25,970 Balance of individual accounts is under 5% of this account's balance. 343,975 $	Remark

Summary 12, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF EMPLOYEE BENEFITS EXPENSES, DEPRECIATION AND AMORTIZATION BY FUNCTION FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 13

Summary 13
By nature Employee benefits expenses (Note) Wages and salaries Labor and health insurance Pension Directors' compensation Others Depreciation Amortization		Year ended December 31,2020		Total 716,847 $ 24,230 13,003 1,800 39,341 795,221 $ 4,950 $ - $		Year ended December 31,2019
	Classified as Operating Costs 135,287 $ 5,042 3,106 - 8,070 151,505 $ 686 $ - $	Classified as Operating Expenses 581,560 $ 19,188 9,897 1,800 31,271 643,716 $ 3,257 $ - $	Classified as Non-operating Expenses - $ - - - - - $ 1,007 $ - $		Classified as Operating Costs 175,573 $ 6,055 3,314 - 9,132 194,074 $ 1,679 $ - $	Classified as Operating Expenses 381,184 $ 14,700 7,917 1,902 24,244 429,947 $ 4,933 $ 1,146 $	Classified as Non-operating Expenses - $ - - - - - $ 1,166 $ - $	Total
								556,757 $ 20,755 11,231 1,902 33,376
								624,021 $
								7,778 $
								1,146 $

Note A: As of December 31, 2020 and 2019, the Company had 176 and 166 employees, respectively, including 5 non-employee directors for both years.

• B. A company whose stock is listed for trading on the stock exchange or over-the-counter securities exchange shall additionally disclose the following information:

• (a) Average employee benefit expense in current year was $4,640 ((Total employee benefit expense in current year - Total directors’ compensation in current year)/ (Number of employees in current year - Number of non-employee directors in current year)).

Average employee benefit expense in previous year was $3,864 ((Total employee benefit expense in previous year - Total directors’ compensation in previous year)/ (Number of employees in previous year - Number of non-employee directors in previous year)).

• (b) Average employee salaries in current year was $4,192 (Total employee salaries in current year / (Number of employees in current year - Number of non-employee directors in current year)).

Average employee salaries in previous year was $3,458 (Total employee salaries in previous year / (Number of employees in previous year - Number of non-employee directors in previous year)).

• (c) Adjustment of average employee salaries was (21.22%) ((Average employee salaries in current year - Average employee salaries in previous year)/ Average employee salaries in previous year).

• (d) The compensation to supervisors was $0 for the years ended December 31, 2020 and 2019.

Summary 13, Page 1

FOXCONN TECHNOLOGY CO., LTD. SUMMARY OF EMPLOYEE BENEFITS EXPENSES, DEPRECIATION AND AMORTIZATION BY FUNCTION (Cont.) FOR THE YEAR ENDED DECEMBER 31, 2020

(Expressed in thousands of New Taiwan dollars, except as otherwise indicated)

Summary 13

• (e) The Company's compensation policies (including for board of directors, managers and employees)

• (i) Compensation policy for board of directors: the distribution of compensation and travel allowance to directors (including independent directors) are made in accordance with the “Rules for Distribution of Compensation to Directors” as approved by the board of directors. All directors received a fixed payment for compensation and travel allowance, and no variable payments were made.

• (ii) Compensation policy for managers: the distribution of salaries to managers are made in accordance with the "Rules for Distribution of Remuneration to Managers", the Company's profit and loss statement for management, and their level of contribution. Timely reviews of the manager's remuneration program will be made in line with the actual operating conditions and the relevant laws and regulations. The remuneration program includes a base salary, a performance bonus, and an individual bonus. For base salaries, the Company takes into account the industry standards, job title, academic qualifications, experiences, professional competencies and job responsibilities. The performance bonuses are allocated based on the level of contribution made by each operating segment to the profits earned by the Company. The individual bonus is based on the individual performance of each manager.

• (iii) Compensation policy for employees: the distribution of compensation to the employees is based on the individual's capabilities, level of contribution to the company, individual's performance, the value of the role to the Company, and the projected future risks the Company will face. If the Company generates a profit in the current period, 4-6% of distributable profit shall be allocated as employees' bonus in accordance with the Company's Articles of Association. The bonus will be paid to each employee based on their performance.

Summary 13, Page 2